UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                    FORM 10-K


(Mark One)

[X]  ANNUAL REPORT  PURSUANT TO SECTION 13 OR 15(d) OF THE  SECURITIES  EXCHANGE
     ACT OF 1934

For the fiscal year ended March 31, 2007

                                       OR

[ ]  TRANSITION   REPORT  PURSUANT   TO  SECTION  13 OR 15(d) OF THE  SECURITIES
     EXCHANGE ACT OF 1934


                         COMMISSION FILE NUMBER 0-24652

                          FREEDOM TAX CREDIT PLUS L.P.
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

                     Delaware                                     13-3533987
-------------------------------------------------            -------------------
 (State or other jurisdiction of incorporation or             (I.R.S. Employer
                  organization)                              Identification No.)

      625 Madison Avenue, New York, New York                        10022
-------------------------------------------------            -------------------
     (Address of principal executive offices)                     (Zip Code)

Registrant's telephone number, including area code (212) 317-5700

Securities registered pursuant to Section 12(b) of the Act:

     None

Securities registered pursuant to Section 12(g) of the Act:

     Title of Class
     Beneficial Assignment Certificates and Limited Partnership Interests

     Indicate by check mark if the registrant is a well-known  seasoned  issuer,
as defined in Rule 405 of the Securities Act. Yes [ ] No [X]

     Indicate by check mark if the  registrant  is not  required to file reports
pursuant to Section 13 or Section 15(d) of the Act. Yes [ ] No [X]

     Indicate  by check mark  whether the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]

       Indicate by check mark if  disclosure of  delinquent  filers  pursuant to
Item 405 of Regulation S-K (ss.229.405 of this chapter) is not contained herein,
and will not be contained,  to the best of registrant's knowledge, in definitive
proxy or information  statements  incorporated  by reference in Part III of this
Form 10-K or any amendment to this Form 10-K. [X]

     Indicate by check mark whether the registrant is a large accelerated filer,
an accelerated filer, or a non-accelerated filer. See definition of "accelerated
filer and large  accelerated  filer" in Rule 12b-2 of the Exchange  Act.  (Check
one):

Large accelerated filer [ ]    Accelerated filer [ ]   Non-accelerated filer [X]

     Indicate  by check mark  whether  the  registrant  is a shell  company  (as
defined in Rule 12b-2 of the Act). Yes [ ] No [X]

     The  approximate  aggregate book value of the voting and non-voting  common
equity held by  non-affiliates  of the  registrant  as of September 30, 2006 was
$(1,368,000) based on Limited Partner equity (deficit) as of such date.

     Registrant's voting and non-voting common equity is not publicly traded.

                       DOCUMENTS INCORPORATED BY REFERENCE

     None


<PAGE>

                                     PART I


Item 1.  Business

General
-------

Freedom Tax Credit Plus L.P. (the  "Partnership") is a limited partnership which
was  formed  under the laws of the State of  Delaware  on August 28,  1989.  The
General  Partners of the  Partnership  are Related  Freedom  Associates  L.P., a
Delaware limited  partnership (the "Related  General  Partner"),  and Freedom GP
Inc., a Delaware  corporation  (the "Freedom  General Partner" and together with
the Related General Partner, the "General Partners"). The general partner of the
Related  General  Partner  is  Related  Freedom   Associates  Inc.,  a  Delaware
corporation.  The ultimate parent of the General Partners is Centerline  Holding
Company ("Centerline") (which had been known as CharterMac until April 2007).

On March 15, 2007,  Centerline  announced  the  retirement  of Alan P. Hirmes as
Chief Financial  Officer of Centerline.  Upon his  retirement,  he also resigned
from his  position as Director,  President,  Chief  Executive  Officer and Chief
Financial  Officer  of the  general  partner  of the  Related  General  Partner.
Centerline  has named  Robert L. Levy as Chief  Financial  Officer and Andrew J.
Weil as Chief Executive Officer to replace Mr. Hirmes.

On  February  9,  1990,  the  Partnership   commenced  a  public  offering  (the
"Offering")  of  Beneficial   Assignment   Certificates   ("BACs")  representing
assignments  of  limited  partnership  interests  in the  Partnership  ("Limited
Partnership  Interests"),  pursuant to a prospectus  dated  February 9, 1990, as
supplemented by supplements thereto,  dated December 7, 1990, May 10, 1991, July
10, 1991 and July 23, 1991 (as so supplemented, the "Prospectus").

The Partnership  received $72,896,000 of the gross proceeds of the Offering from
4,780 investors, and the Offering was terminated on August 8, 1991. (See Item 8,
"Financial  Statements and Supplementary  Data," Note 1 of Notes to Consolidated
Financial Statements.)

The  Partnership  was  formed to invest as a limited  partner  in other  limited
partnerships  ("Local  Partnerships"),  each of which owns one or more leveraged
low-income   multi-family   residential  complexes  ("Apartment   Complexes"  or
"Properties")  that are  eligible  for the  low-income  housing tax credit ("Tax
Credit")  enacted in the Tax  Reform Act of 1986,  and some of which may also be
eligible  for  the  historic   rehabilitation   tax  credit.  The  Partnership's
investment in each Local  Partnership  represents 98% to 99% of the  partnership
interests in the Local  Partnership.  The  Partnership  had originally  acquired
interests  in  forty-two  Local   Partnerships,   and  as  of  March  31,  2007,
approximately  $58,000,000 of the net proceeds of the Offering has been invested
in such Local  Partnerships,  representing all of the Partnership's net proceeds
available  for  investment.  Subsequent  to March 31, 2007 and as of the date of
this  filing,  there  have  been no  additional  investments,  nor are any other
investments expected. See Item 2, "Properties," below.

The  Partnership  is currently  in the process of disposing of its  investments.
During the fiscal  year ended March 31,  2007,  the  properties  and the related
assets and  liabilities of thirteen  Local  Partnerships  and the  Partnership's
limited  partnership  interest in two Local  Partnerships were sold. Through the
year ended March 31, 2007 the  Partnership  has  disposed of  twenty-two  of its
forty-two original investments.  Subsequently,  the Partnership sold its limited
partnership interest in one Local Partnership and six Local Partnerships entered
into agreements to sell their properties and the related assets and liabilities.
No assurance can be given as to whether or when these sales will actually occur.
All gains and losses on sales are included in discontinued operations.

The investment objectives of the Partnership are described below.

1. Entitle  qualified  BACs  holders to Tax Credits  over the Credit  Period (as
defined below) with respect to each Apartment Complex.

2. Preserve and protect the Partnership's capital.

3.  Participate in any capital  appreciation  in the value of the Properties and
provide  distributions  of sale or refinancing  proceeds upon the disposition of
the Properties.

4. Allocate  passive losses to individual  BACs holders to offset passive income
that they may realize  from rental real  estate  investments  and other  passive
activities,  and allocate  passive  losses to  corporate  BACs holders to offset
business income.

One of the Partnership's  objectives is to entitle qualified BACs holders to Tax
Credits over the period of the  Partnership's  entitlement  to claim Tax Credits
(for each  Property,  generally  ten years  from the date of  investment  or, if
later, the date the Property is leased to qualified tenants;  referred to herein
as the "Credit Period"). Each of the Local Partnerships in which the Partnership
has an interest  has been  allocated by the  relevant  state  credit  agency the
authority to recognize Tax Credits during the Credit  Period,  provided that the
Local Partnership  satisfies the rent  restriction,  minimum set-aside and other
requirements  for recognition of the Tax Credits at all times during the 15-year
compliance period (the "Compliance Period"). Once a Local Partnership has become
eligible to recognize Tax Credits,  it may lose such  eligibility  and suffer an
event of "recapture" if its Property fails to remain in compliance  with the Tax
Credit requirements. None of the Local Partnerships in which the Partnership has
acquired an interest has suffered an event of recapture.

Tax Credits  with respect to a given  Apartment  Complex are  available  for the
Credit Period.  However,  the annual Tax Credits  available in the year in which
the Apartment Complex is leased to qualified tenants must be prorated based upon
the months  remaining  in the year.  The amount of the  annual Tax  Credits  not
available in the first year will be available  in the  eleventh  year.  Internal
Revenue  Code  Section 42  regulates  the use of the  Apartment  Complexes as to
occupancy,  eligibility,  and unit gross rent,  among other  requirements.  Each
Apartment  Complex  must meet the  provisions  of these  regulations  during the
Compliance  Period in order to remain qualified to receive the credits.  Certain
Apartment Complexes have extended compliance periods of up to fifty years.

A loss on  impairment of assets is recorded when  management  estimates  amounts
recoverable   through  future   operations  and  sale  of  the  Property  on  an

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<PAGE>

undiscounted  basis  are  below  depreciated  cost.  At that  time the  Property
investments  themselves are reduced to estimated fair value (generally using the
discounted cash flow valuation method).  Through March 31, 2007, the Partnership
has  recorded  approximately  $5,726,000  as a loss on  impairment  of assets or
reduction to estimated fair value.

As of December 31, 2002, all the Local  Partnerships have completed their Credit
Periods and the  Partnership  has met its primary  objective of  generating  Tax
Credits  for  qualified  BACs  holders.  However,  each Local  Partnership  must
continue  to  comply  with  the Tax  Credit  requirements  until  the end of the
Compliance Period in order to avoid recapture of the Tax Credits. The Compliance
Periods will continue  through  December 31, 2007 with respect to the Properties
depending upon when the Credit Period commenced.

The Partnership  continues to meet its objective of allocating passive losses to
individual  BACs  holders to offset  passive  income that they may realize  from
rental real estate  investments  and other passive  activities,  and  allocating
passive losses to corporate BACs holders to offset business income.

As of March 31, 2007, the  Partnership  has not met its investment  objective of
providing  cash  distributions  from  the  operations  of  the  Properties.  The
Partnership  does not anticipate  providing cash  distributions  to BACs holders
other than distributions of sale or refinancing proceeds upon the disposition of
Properties.  Furthermore, as noted below, at this time there can be no assurance
that the Partnership  will achieve its objective.  During and through the fiscal
year ended March 31, 2007,  distributions  from sales  proceeds were made to the
BACs  holders  of  approximately  $6,925,000  and to  the  General  Partners  of
approximately $70,000.

Sale of Properties
------------------

The Partnership is currently in the process of disposing of its investments.  As
of March 31, 2007, the Partnership's  limited partnership interest in nine Local
Partnerships and the property and the related assets and liabilities of thirteen
Local  Partnerships  have been sold.  There can be no  assurance  as to when the
Partnership will dispose of its remaining  investments or the amount of proceeds
which may be received. However, based on the historical operating results of the
Local Partnerships and the current economic conditions, including changes in tax
laws,  it is  unlikely  that  the  proceeds  from  such  sales  received  by the
Partnership  will be sufficient to return to the limited partners their original
investments.  All  gains  and  losses  on sales  are  included  in  discontinued
operations. Subsequently, on April 30, 2007, six Local Partnerships entered into
agreements to sell their property and the related assets and liabilities, and on
May 3,  2007,  the  Partnership's  limited  partnership  interest  in one  Local
Partnership was sold (see Item 8, Note 13).

On January 31,  2007,  the property and the related  assets and  liabilities  of
Eagle Ridge Limited  Partnership  ("Eagle  Ridge") were sold to an  unaffiliated
third party purchaser for a sales price of $2,000,000.  The Partnership received
$412,730 as a  distribution  from this sale after the  repayment  of  mortgages,
other  liabilities,  closing costs and  distributions  to minority  interests of
approximately $1,587,000.  The sale resulted in a gain of approximately $600,000
resulting  from the write-off of the partners'  deficit basis in the property of
approximately  $600,000  at the  date of the  sale.  The  sale  resulted  in the
liquidation of Eagle Ridge.

On January 10,  2007,  the property and the related  assets and  liabilities  of
Lauderdale Lakes Associates, Ltd. ("Lauderdale Lakes") were sold to an affiliate
of the Local General  Partner for a sales price of $5,900,000.  The  Partnership
received  $790,773  as a  distribution  from this sale  after the  repayment  of
mortgages,  other  liabilities  and closing costs of  approximately  $5,109,000.
During the quarter  ended  December 31, 2006, in  accordance  with  Statement of
Financial  Accounting  Standards  No. 144,  "Accounting  for the  Impairment  or
Disposal of Long-Lived  Assets"  ("SFAS No. 144"),  the  Partnership  deemed the
building  impaired and wrote it down to its fair value which  resulted in a loss
on impairment of approximately $1,106,000.  Because Lauderdale Lakes was sold to
a related  party of the  Local  Partnership,  the sale  resulted  in a  non-cash
distribution  from  the  Local  Partnership  to the  Local  General  Partner  of
approximately  $329,000.  Such distribution flows through minority interest as a
result of the write-off of the partners' basis in the property of  approximately
$329,000. The sale resulted in the liquidation of Lauderdale Lakes.

On January 1, 2007, the Partnership's  limited  partnership  interest in Harmony
Associates,  L.P.  ("Harmony  Gate") was sold to the Local General Partner for a
sales price of $1,409,990.  The Partnership received proceeds of $1,409,990 from
the  sale.  Because  Harmony  Gate was  sold to a  related  party  of the  Local
Partnership,  the  sale  resulted  in  a  non-cash  contribution  to  the  Local
Partnership  from the Local General Partner of  approximately  $1,211,000.  Such
contribution flows through minority interest as a result of the write-off of the
partners'  basis in the property of  approximately  $199,000 and the  $1,409,990
cash received from the sale.

On January 1, 2007, the Partnership's  limited  partnership  interest in Conifer
Irondequoit Associates ("Abraham Lincoln") was sold to the Local General Partner
for a sales price of $1. Because  Abraham Lincoln was sold to a related party of
the Local Partnership, the sale resulted in a non-cash contribution to the Local
Partnership  from the Local  General  Partner of  approximately  $127,000.  Such
contribution flows through minority interest as a result of the write-off of the
partners' deficit basis in the property of approximately $127,000 at the date of
the  sale.  The sale  also  resulted  in a  non-cash  contribution  to the Local
Partnership  from an affiliate  of the Local  General  Partner of  approximately
$20,000 as a result of the write-off of payables owed by the Local  Partnership.
The sale resulted in the liquidation of Abraham Lincoln.

On October 25, 2006, the property and the related assets and  liabilities of C-H
Development Group Associates,  L.P. ("Manhattan B") were sold to an unaffiliated
third party purchaser for a sales price of $2,100,000.  The Partnership received
$850,980 as a  distribution  from this sale after the  repayment  of  mortgages,
other  liabilities  and  closing  costs of  approximately  $1,249,000.  The sale
resulted in a gain of approximately $842,000 resulting from the write-off of the
partners' deficit basis in the property of approximately $842,000 at the date of
the sale. The sale resulted in the liquidation of Manhattan B.

On September 29, 2006,  the property and the related  assets and  liabilities of
Oxford Trace  Apartments  ("Oxford  Trace") were sold to an  unaffiliated  third
party purchaser for a sales price of $725,000.  The Partnership received $49,279
as a  distribution  from  this sale  after the  repayment  of  mortgages,  other
liabilities and closing costs of approximately  $676,000. The sale resulted in a
gain of  approximately  $373,000  resulting  from the write-off of the partners'
deficit basis in the property of approximately $373,000 at the date of the sale.
The sale also resulted in a non-cash  contribution to the Local Partnership from
the Local General Partner of approximately $494,000 as a result of the write-off
of payables owed by the Local Partnership.  The sale resulted in the liquidation
of Oxford Trace.

On September 29, 2006,  the property and the related  assets and  liabilities of
Tivoli Place  Apartments  ("Tivoli  Place") were sold to an  unaffiliated  third

                                       3
<PAGE>

party  purchaser  for a sales  price of  $3,050,000.  The  Partnership  received
$1,331,631  as a  distribution  from this sale after the repayment of mortgages,
other  liabilities,  closing costs and  distributions  to minority  interests of
approximately $1,711,000.  The sale resulted in a gain of approximately $905,000
resulting  from the write-off of the partners'  deficit basis in the property of
approximately  $905,000  at the date of the sale.  The sale also  resulted  in a
non-cash distribution from the Local Partnership to the Local General Partner of
approximately  $62,000 as a result of the write-off of  receivables  owed to the
Local Partnership. The sale resulted in the liquidation of Tivoli Place.

On September 20, 2006,  the property and the related  assets and  liabilities of
Bennion Park Apartments  ("Mulberry")  were sold to an unaffiliated  third party
purchaser for a sales price of $4,900,000.  The Partnership  received $2,321,740
as a  distribution  from  this sale  after the  repayment  of  mortgages,  other
liabilities,   closing  costs  and   distributions  to  minority   interests  of
approximately  $2,578,000.   The  sale  resulted  in  a  gain  of  approximately
$2,183,000  resulting  from the write-off of the partners'  deficit basis in the
property  of  approximately  $2,183,000  at the date of the sale.  The sale also
resulted  in a non-cash  distribution  from the Local  Partnership  to the Local
General  Partner  of  approximately  $980,000  as a result of the  write-off  of
receivables owed to the Local Partnership.  The sale resulted in the liquidation
of Mulberry.

On September 20, 2006,  the property and the related  assets and  liabilities of
Twin Trees  Apartments  ("Twin Trees") were sold to an unaffiliated  third party
purchaser for a sales price of $2,300,000.  The Partnership received $927,148 as
a  distribution  from  this  sale  after  the  repayment  of  mortgages,   other
liabilities,   closing  costs  and   distributions  to  minority   interests  of
approximately $1,373,000.  The sale resulted in a gain of approximately $904,000
resulting  from the write-off of the partners'  deficit basis in the property of
approximately  $904,000  at the date of the sale.  The sale also  resulted  in a
non-cash distribution from the Local Partnership to the Local General Partner of
approximately  $582,000 as a result of the write-off of receivables  owed to the
Local Partnership. The sale resulted in the liquidation of Twin Trees.

On July 26,  2006,  the  property  and the  related  assets and  liabilities  of
Washington  Brooklyn  Limited   Partnership   ("Washington")  were  sold  to  an
unaffiliated  third party purchaser for a sales price of approximately  $160,000
and the  assumption  of the  related  mortgage  liabilities  and the  litigation
discussed in Note 10. After the repayment of other liabilities and closing costs
of approximately  $60,000,  the Partnership  will receive an additional  payment
estimated  to be  approximately  $100,000  to be paid at a later  date  upon the
settlement of a foreclosure dispute (see Note 10). During the quarter ended June
30, 2006, in accordance with SFAS No. 144, the  Partnership  deemed the building
impaired  and  wrote  it down to its  fair  value  which  resulted  in a loss on
impairment of $400,000.  The sale resulted in a loss of  approximately  $384,000
resulting  from  the  write-off  of  the  partners'  basis  in the  property  of
approximately  $384,000  at the date of the sale.  The sale also  resulted  in a
non-cash  contribution to the Local  Partnership  from an affiliate of the Local
General  Partner  of  approximately  $30,000  as a result  of the  write-off  of
payables  owed by Local  Partnership.  The sale resulted in the  liquidation  of
Washington.

On June 26, 2006, the property and the related assets and liabilities of Hunters
Chase  Apartments  ("Hunters  Chase") were sold to an  unaffiliated  third party
purchaser for a sales price of $2,730,000.  The Partnership received $334,243 as
a  distribution  from  this  sale  after  the  repayment  of  mortgages,   other
liabilities and closing costs of approximately $2,396,000.  The sale resulted in
a gain of approximately $1,192,000 resulting from the write-off of the partners'
deficit  basis in the property of  approximately  $1,192,000  at the date of the
sale,  which was  recorded  during the quarter  ended  September  30,  2006.  An
adjustment to the gain of approximately  $72,000 was recorded during the quarter
ended December 31, 2006, resulting in overall gain of approximately  $1,264,000.
The sale also resulted in a non-cash  contribution to the Local Partnership from
the  Local  General  Partner  of  approximately  $1,245,000  as a result  of the
write-off of payables  owed by the Local  Partnership.  The sale resulted in the
liquidation of Hunters Chase.

On June 26,  2006,  the  property  and the  related  assets and  liabilities  of
Wilshire  Apartments  ("Wilshire")  were  sold to an  unaffiliated  third  party
purchaser for a sales price of $1,700,000. The Partnership received $31,986 as a
distribution from this sale after the repayment of mortgages,  other liabilities
and closing costs of  approximately  $1,668,000.  The sale resulted in a gain of
approximately  $680,000  resulting  from the write-off of the partners'  deficit
basis in the property of  approximately  $680,000 at the date of the sale, which
was recorded during the quarter ended September 30, 2006. A downward  adjustment
to the gain of  approximately  $161,000  was recorded  during the quarter  ended
December 31, 2006, resulting in overall gain of approximately $519,000. The sale
also resulted in a non-cash contribution to the Local Partnership from the Local
General  Partner of  approximately  $1,179,000  as a result of the  write-off of
payables owed by the Local Partnership.  The sale resulted in the liquidation of
Wilshire.

On June 20, 2006, the property and the related assets and  liabilities of Bethel
Park  Apartments  ("Bethel  Park")  were  sold to an  unaffiliated  third  party
purchaser for a sales price of $2,500,000.  The Partnership received $620,674 as
a  distribution  from  this  sale  after  the  repayment  of  mortgages,   other
liabilities and closing costs of approximately $1,879,000.  The sale resulted in
a gain of approximately  $319,000  resulting from the write-off of the partners'
deficit basis in the property of approximately $319,000 at the date of the sale,
which was recorded during the quarter ended September 30, 2006. An adjustment to
the gain of  approximately  $11,000 was recorded  during the quarter ended March
31, 2007,  resulting in overall gain of  approximately  $330,000.  The sale also
resulted  in a non-cash  contribution  to the Local  Partnership  from the Local
General  Partner  of  approximately  $298,000  as a result of the  write-off  of
payables owed by the Local Partnership.  The sale resulted in the liquidation of
Bethel Park.

On June 20, 2006, the property and the related assets and liabilities of Zebulon
Park Apartments  ("Zebulon") were sold to an unaffiliated  third party purchaser
for a  sales  price  of  $2,000,000.  The  Partnership  received  $420,305  as a
distribution from this sale after the repayment of mortgages,  other liabilities
and closing costs of  approximately  $1,580,000.  The sale resulted in a gain of
approximately  $115,000  resulting  from the write-off of the partners'  deficit
basis in the property of  approximately  $115,000 at the date of the sale, which
was recorded during the quarter ended September 30, 2006. A downward  adjustment
to the gain of  approximately  $3,000  was  recorded  during the  quarter  ended
December 31, 2006, resulting in overall gain of approximately $112,000. The sale
also resulted in a non-cash contribution to the Local Partnership from the Local
General  Partner  of  approximately  $264,000  as a result of the  write-off  of
payables owed by the Local Partnership.  The sale resulted in the liquidation of
Zebulon.

On June 5,  2006,  the  property  and the  related  assets  and  liabilities  of
Northwood Apartments of Georgia ("Northwood") were sold to an unaffiliated third
party  purchaser  for a sales  price of  $6,050,000.  The  Partnership  received
$3,197,019  as a  distribution  from this sale after the repayment of mortgages,
other  liabilities,  closing costs and  distributions  to minority  interests of
approximately  $2,853,000.   The  sale  resulted  in  a  gain  of  approximately
$2,367,000  resulting from the write-off of the partners'  basis in the property
of  approximately  $2,367,000 at the date of the sale, which was recorded during

                                       4
<PAGE>

the quarter ended September 30, 2006. An adjustment to the gain of approximately
$81,000 was  recorded  during the quarter  ended March 31,  2007,  resulting  in
overall gain of approximately  $2,448,000.  The sale also resulted in a non-cash
distribution  from  the  Local  Partnership  to the  Local  General  Partner  of
approximately  $868,000 as a result of the write-off of receivables  owed to the
Local Partnership. The sale resulted in the liquidation of Northwood.

On March 31, 2006, the Partnership's  limited  partnership  interest in Davidson
Court  Limited  Partnership  ("Davidson  Court") was sold to an affiliate of the
general  partner of the Local  Partnership  (the "Local General  Partner") for a
sales price of $1,100,000.  The Partnership received proceeds of $1,066,715 from
this sale after the payment of closing costs of  approximately  $33,000 from the
sales price.  Because  Davidson  Court was sold to a related  party of the Local
Partnership,  the  sale  resulted  in  a  non-cash  contribution  to  the  Local
Partnership  from the Local  General  Partner  of  approximately  $68,000.  Such
contribution flows through minority interest as a result of the write-off of the
partners'  basis in the property of  approximately  $999,000 and the  $1,066,715
cash received from the sale.

On March  31,  2006,  the  Partnership's  limited  partnership  interest  in CLM
Equities  Limited  Partnership  ("Morris  Avenue") was sold to the Local General
Partner  and its  affiliate  for a sales  price  of  $265,000.  The  Partnership
received proceeds of $264,990 from this sale.  Because Morris Avenue was sold to
a related  party of the  Local  Partnership,  the sale  resulted  in a  non-cash
distribution  from  the  Local  Partnership  to the  Local  General  Partner  of
approximately  $424,000,  which was recorded  during the quarter  ended June 30,
2006. A downward  adjustment  of  approximately  $9,000 was recorded  during the
quarter ended December 31, 2006,  resulting in overall non-cash  distribution of
approximately  $415,000.  Such distribution flows through minority interest as a
result of the write-off of the partners' basis in the property of  approximately
$680,000 and the $264,990 cash received from the sale.

On February 1, 2006, the Partnership's  limited partnership  interest in Ivanhoe
Apartments Limited Partnership ("Ivanhoe") was sold to the Local General Partner
for a sales price of $150,000.  The  Partnership  received  proceeds of $150,000
from  this  sale.  Because  Ivanhoe  was sold to a  related  party of the  Local
Partnership,  the sale  resulted  in a  non-cash  distribution  from  the  Local
Partnership to the Local General  Partner of  approximately  $50,000,  which was
recorded  during the quarter  ended June 30, 2006. An adjustment to the non-cash
distribution  of  approximately  $35,000 was recorded  during the quarter  ended
March 31, 2007,  resulting in overall  non-cash  distribution  of  approximately
$85,000.  Such  distribution  flows through minority interest as a result of the
write-off of the partners' basis in the property of  approximately  $235,000 and
the $150,000 cash  received from the sale.  The sale also resulted in a non-cash
contribution to the Local  Partnership  from an affiliate of the General Partner
of approximately  $35,000 as a result of the write-off of payables owed by Local
Partnership.

On January 19, 2006, the Partnership's  limited  partnership  interest in Nelson
Anderson Affordable Housing Limited Partners ("Nelson Anderson") was sold to the
Local General Partner for a sales price of $490,000.  The  Partnership  received
proceeds of  $489,990  from this sale.  Because  Nelson  Anderson  was sold to a
related  party  of the  Local  Partnership,  the  sale  resulted  in a  non-cash
distribution  from  the  Local  Partnership  to the  Local  General  Partner  of
approximately  $196,000,  which was recorded  during the quarter  ended June 30,
2006. A downward adjustment to the non-cash distribution of approximately $1,000
was  recorded  during the quarter  ended March 31,  2007,  resulting  in overall
non-cash distribution of approximately $197,000. Such distribution flows through
minority  interest as a result of the  write-off of the  partners'  basis in the
property of approximately $687,000 and the $489,990 cash received from the sale.
The sale also resulted in a non-cash  contribution to the Local Partnership from
an affiliate of the General Partner of approximately  $28,000 as a result of the
write-off of payables owed by Local Partnership.

On January 1, 2006, the Partnership's limited partnership interest in Greenfield
Village Limited Partnership ("Greenfield Village") was sold to the Local General
Partner for a sales  price of  $75,000.  The  Partnership  received  proceeds of
$74,990 from the sale. Because Greenfield Village was sold to a related party of
the Local Partnership, the sale resulted in a non-cash contribution to the Local
Partnership from the Local General Partner of approximately $461,000,  which was
recorded  during the  quarter  ended March 31,  2006.  Such  contribution  flows
through minority  interest as a result of the write-off of the partners' deficit
basis in the property of  approximately  $386,000 and the $74,990 cash  received
from the sale.

On January 1, 2006, the Partnership's  limited partnership  interest in The Oaks
Village  Limited  Partnership  ("Oaks  Village")  was sold to the Local  General
Partner for a sales  price of  $75,000.  The  Partnership  received  proceeds of
$74,990 from this sale.  Because Oaks Village was sold to a related party of the
Local  Partnership,  the sale resulted in a non-cash  contribution  to the Local
Partnership from the Local General Partner of approximately $407,000,  which was
recorded  during the  quarter  ended March 31,  2006.  Such  contribution  flows
through minority  interest as a result of the write-off of the partners' deficit
basis in the property of  approximately  $332,000 and the $74,990 cash  received
from the sale.

On June 20, 2005, the  Partnership's  limited  partnership  interest in Parkside
Townhomes  Associates  ("Parkside")  was sold to the Local General Partner for a
sales price of $650,000. The Partnership received $611,140, after the payment of
closing costs of approximately  $39,000, which included $161,140 paid in cash at
closing and $450,000  pursuant to a promissory  note payable to the  Partnership
(which was paid off in full as of December 31,  2006).  During the quarter ended
June 30,  2005,  in  accordance  with SFAS No. 144, the  Partnership  deemed the
building  impaired and wrote it down to its fair value which  resulted in a loss
on impairment of $555,000.  Because  Parkside was sold to a related party of the
Local Partnership,  the sale resulted in a non-cash  distribution from the Local
Partnership  to  the  Local  General  Partner  of  approximately  $32,000.  Such
distribution flows through minority interest as a result of the write-off of the
partners' basis in the property of approximately  $643,000 and the $611,140 cash
received from the sale.

Segments
--------
The Partnership operates in one segment, which is the investment in multi-family
residential  property.  Financial information about this segment is set forth in
Item 8 hereto.

Competition
-----------
The real estate  business is highly  competitive  and  substantially  all of the
properties acquired are subject to active competition from similar properties in
their respective  vicinities.  In addition,  various other limited  partnerships
may, in the future, be formed by the General Partners and/or their affiliates to
engage in businesses which may compete with the Partnership.

Employees
---------
The Partnership does not have any direct  employees.  All services are performed
for the Partnership by its General  Partners and their  affiliates.  The General
Partners receive compensation in connection with such activities as set forth in

                                       5
<PAGE>

Items 11 and 13. In addition,  the Partnership  reimburses the General  Partners
and certain of their  affiliates  for expenses  incurred in connection  with the
performance  by their  employees of services for the  Partnership  in accordance
with the Partnership's Amended and Restated Agreement and Certificate of Limited
Partnership (the "Partnership Agreement").

Item 1A.  Risk Factors

The  Partnership is subject to risks  incident to potential  losses arising from
the management and ownership of improved real estate.  The  Partnership can also
be affected by poor economic conditions  generally,  however no more than 30% of
the Properties are located in any single state. There are also substantial risks
associated with owning properties receiving government  assistance;  for example
the  possibility  that  Congress  may not  appropriate  funds to enable the U.S.
Department of Housing and Urban  Development  ("HUD") to make rental  assistance
payments.  HUD also  restricts  annual cash  distributions  to partners based on
operating  results and a percentage of the owners'  equity  contribution.  As of
March 31,  2007,  there were three Local  Partnerships  subsidized  by HUD.  The
Partnership cannot sell or substantially liquidate its investments in subsidiary
partnerships  during the period that the  subsidy  agreements  are in  existence
without  HUD's  approval.  Furthermore  there  may  not  be  market  demand  for
apartments at full market rents when the rental assistance contract expires.

Item 1B.  Unresolved Staff Comments

None

                                       6
<PAGE>

Item 2.  Properties

The  Partnership  holds a 99%,  98.99% and 98% limited  partnership  interest in
seven, ten and twenty-two Local Partnerships, respectively. Set forth below is a
schedule of these Local Partnerships  including certain  information  concerning
the Apartment Complexes (the "Local Partnership Schedule").  Further information
concerning  these  Local  Partnerships  and  their  Properties,   including  any
encumbrances  affecting the Properties,  may be found in Item 15 (a) 2; Schedule
III.
<TABLE>
<CAPTION>

                                    Local Partnership Schedule
                                    --------------------------

                                                               % of Units Occupied at May 1,
         Name of Location                             -----------------------------------------------
        (Number of Units)             Date Acquired    2007      2006      2005      2004      2003
----------------------------------   --------------   -------   -------   -------   -------   -------
<S>                                  <C>                 <C>       <C>       <C>       <C>       <C>
Parkside Townhomes
York, PA (53)                        September 1990       (a)       (a)       92%       98%       89%

Twin Trees
Layton, UT (43)                        October 1990       (c)       98%       93%       95%       95%

Bennion (Mulberry)
Taylorsville, UT (80)                  October 1990       (c)       95%       95%       93%       88%

Hunters Chase
Madison, AL (91)                       October 1990       (c)       90%       80%       80%       95%

Wilshire Park
Huntsville, AL (65)                    October 1990       (c)       95%       85%       91%       88%

Bethel Park
Bethel, OH (84)                        October 1990       (c)       94%       83%       96%       89%

Zebulon Park
Owensville, OH (66)                    October 1990       (c)       84%       86%       94%       94%

Tivoli Place
Murphreesboro, TN (61)                 October 1990       (c)       90%       95%       90%       92%

Northwood (Hartwood)
Jacksonville, FL (110)                 October 1990       (c)       91%       93%       97%       92%

Oxford Trace
Aiken, SC (29)                         October 1990       (c)       93%       90%       96%       97%

Ivanhoe Apts.
Salt Lake City, UT (19)                January 1991       (a)       (a)       95%      100%       79%

Washington Brooklyn
Brooklyn, NY (24)                      January 1991       (c)      100%      100%      100%      100%

Manhattan B (C.H. Development)
New York, NY (35)                      January 1991       (c)      100%      100%       97%      100%

Davidson Court
Staten Island, NY (38)                   March 1991       (a)       (a)      100%       97%      100%

Magnolia Mews
Philadelphia, PA (63)                    March 1991       90%       95%       97%       95%       98%

Oaks Village
Whiteville, NC (40)                      March 1991       (a)       (a)      100%      100%       98%

Greenfield Village
Dunn, NC (40)                            March 1991       (a)       (a)       98%       98%       98%

Morris Avenue (CLM Equities)
Bronx, NY (58)                           April 1991       (a)       (a)      100%      100%      100%

Victoria Manor
Riverside, CA (112)                      April 1991       98%       99%       98%      100%      100%

Ogontz Hall
Philadelphia, PA (35)                    April 1991       97%       96%       97%       90%      100%

                                       7
<PAGE>
<CAPTION>

                                    Local Partnership Schedule
                                    --------------------------

                                                               % of Units Occupied at May 1,
         Name of Location                             -----------------------------------------------
        (Number of Units)             Date Acquired    2007      2006      2005      2004      2003
----------------------------------   --------------   -------   -------   -------   -------   -------
<S>                                  <C>                 <C>       <C>       <C>       <C>       <C>
Eagle Ridge
Stoughton, WI (54)                         May 1991       (c)       83%       83%       87%       89%

Nelson Anderson
Bronx, NY (81)                            June 1991       (a)       (a)       93%       98%       98%

Abraham Lincoln Apts.
Irondequoit, NY (69)                 September 1991       (b)       93%       88%       86%       83%

Wilson Street Apts. (Middletown)
Middletown, PA (44)                  September 1991       86%       93%       89%       98%       98%

Lauderdale Lakes
Lauderdale Lakes, FL (172)             October 1991       (c)       99%      100%       99%       97%

Flipper Temple
Atlanta, GA (163)                      October 1991      100%       99%      100%      100%       97%

220 Cooper Street
Camden, NJ (29)                       December 1991       83%       93%       90%      100%      100%

Pecan Creek
Tulsa, OK (47)                        December 1991       88%       92%       85%       96%       92%

Vendome
Brooklyn, NY (24)                     December 1991      100%      100%      100%      100%      100%

Rainer Villas
New Augusta, MS (20)                  December 1991       90%       75%       90%      100%       85%

Pine Shadow Apts.
Waveland, MS (48)                     December 1991       (d)       (d)      100%      100%       98%

Windsor Place
Wedowee, AL (24)                      December 1991      100%      100%      100%      100%      100%

Brookwood Apts.
Foley, AL (38)                        December 1991       89%       92%       95%       84%       95%

Heflin Hills Apts.
Heflin, AL (24)                       December 1991      100%      100%      100%      100%      100%

Shadowood Apts.
Stevenson, AL (24)                    December 1991       96%      100%       96%      100%      100%

Brittany Apts.
DeKalb, MS (25)                       December 1991      100%      100%       96%      100%      100%

Hidden Valley Apts.
Brewton, AL (40)                      December 1991      100%      100%      100%      100%      100%

Westbrook Square
Carthage, MS (32)                     December 1991       88%       78%       94%       97%       97%

Royal Pines Apts. (Warsaw Elderly)
Warsaw, KY (36)                       December 1991      100%      100%       97%      100%      100%

West Hill Square
Gordo, AL (24)                        December 1991      100%      100%       96%      100%      100%

Elmwood Manor
Picayune, MS (24)                     December 1991      100%       96%      100%      100%      100%

Harmony Gate Apts.
Los Angeles, CA (70)                   January 1992       (b)      100%       93%       97%       99%
</TABLE>

                                       8
<PAGE>

(a)  The Partnership's  limited partnership  interest was sold during the fiscal
     year ended March 31, 2006 (see Note 9 in Item 8)
(b)  The Partnership's  limited partnership  interest was sold during the fiscal
     year ended March 31, 2007 (see Note 9 in Item 8).
(c)  The property and the related  assets and  liabilities  were sold during the
     fiscal year ended March 31, 2007 (see Note 9 in Item 8).
(d)  This property  suffered damages from Hurricane Katrina (see Note 10 in Item
     8).

One  Local   Partnership's   assets   balances  are  greater  than  10%  of  the
Partnership's  total assets balances,  and excluding gain on sale of properties,
none of the Local  Partnerships'  revenue  balance  is  greater  than 10% of the
Partnership's total revenue balances.

All leases are  generally  for periods not greater  than one to two years and no
tenant occupies more than 10% of the total rentable square footage in any single
Apartment Complex.

Commercial  tenants (to which average  rental per square foot applies)  comprise
less than 5% of the rental  revenues  of the Local  Partnerships.  Rents for the
residential units are determined annually by HUD and reflect increases,  if any,
in consumer price indices in various geographic areas.

Management of the General  Partners  periodically  reviews the physical state of
the  Properties  and suggests to the respective  Local General  Partners  budget
improvements  which are  generally  funded  from cash  flow from  operations  or
release of replacement reserve escrows.

Management of the General Partners  periodically  reviews the insurance coverage
of the Properties and believes such coverage is adequate.

See Item 1, Business,  above for the general competitive conditions to which the
Properties described above are subject.

Real estate taxes are calculated using rates and assessed valuations  determined
by the township or city in which the Property is located.

The  General  Partners  generally  required  that  the  Local  General  Partners
undertake an obligation to fund operating  deficits of the Local Partnership (up
to a stated maximum amount) during a limited period of time (typically  three to
five years)  following  the  achievement  of break-even  operations  ("Operating
Deficit  Guarantees").  Under the  terms of the  Operating  Deficit  Guarantees,
amounts  funded are treated as operating  loans,  which do not bear interest and
which will be repaid only out of 50% of available  cash flow or out of available
net sale or refinancing  proceeds.  As of March 31, 2007, all Operating  Deficit
Guarantees have expired.


Item 3.  Legal Proceedings

Washington
----------

On July 26, 2006,  the sale of  Washington  was  completed  (see Item 8, Note 9)
pursuant to the purchase and sale agreement. Upon closing, the purchaser assumed
all of  Washington's  rights and  liabilities  with  respect  to the  Litigation
described below.

In  or  about  September  2003,  a  putative  mortgagee   commenced  a  mortgage
foreclosure  action in the Supreme Court of the State of New York,  Kings County
(the  "Court"),  entitled  150 Beach 120th  Street Inc. v.  Washington  Brooklyn
Limited  Partnership,  Index No. 35255/2003,  seeking to foreclose on an alleged
$100,000 loan and mortgage  against the real property (the "Apartment  Complex")
owned by Washington. Apparently, the former general partner of Washington, BUFNY
Houses of  Brooklyn,  Inc.  ("BUFNY"),  allegedly  granted two  mortgages in the
amounts of $225,000 and $100,000 secured by the Apartment  Complex.  Each of the
foregoing  mortgages was granted without the knowledge of Freedom SLP, L.P. (the
"Special Limited  Partner") or the Partnership  (collectively the "Freedom LPs")
or the  consent of the Special  Limited  Partner,  as  required by  Washington's
Amended  and  Restated   Agreement  of  Limited   Partnership  (the  "Washington
Partnership  Agreement").  The Freedom  LPs  believe  that BUFNY did not use the
alleged loan proceeds for the benefit of  Washington  or the Apartment  Complex.
For these and other reasons,  the Freedom LPs contend that the alleged mortgages
are invalid.

In addition, BUFNY allegedly failed to comply with the terms of either mortgage,
which resulted in the holders of the alleged  $100,000  mortgage  commencing the
foreclosure  proceedings.  BUFNY did not appear in or  otherwise  respond to the
foreclosure  proceedings.  The holders of the alleged $225,000 mortgage have not
yet, to the knowledge of the Freedom LPs, commenced any foreclosure proceedings.

Due to  BUFNY's  breach of  fiduciary  duties  and  breaches  of the  Washington
Partnership  Agreement,  the Special Limited Partner  exercised its rights under
the Washington  Partnership  Agreement to remove BUFNY as  Washington's  general
partner  and to  substitute  itself  as the  new  replacement  general  partner,
effective April 26, 2004.

Shortly  after the Freedom LPs became  aware of these  foreclosure  proceedings,
their counsel  contacted  counsel for the plaintiffs and mortgagees in an effort
to learn more about the alleged  mortgages and to resolve the disputes  relating
to the mortgages.  When those efforts failed,  the Freedom LPs filed a motion to
intervene  in the  foreclosure  action  and to file a late  answer  on behalf of
themselves  and  Washington.  The  Freedom LPs contend  that the  mortgages  are
invalid  and  that   Washington  is  not  liable  for  them  or  the  underlying
indebtedness. In an order dated September 7, 2004, the Court granted the Freedom
LPs' motion to intervene and to file a late answer on behalf of Washington.

On or about  September 21, 2004,  the Freedom LPs, on behalf of  themselves  and
Washington, served an answer, counterclaims and crossclaims in defending against
the action.  The answer  denied the material  allegations  of the  complaint and
asserted certain  affirmative  defenses,  counterclaims  and crossclaims.  Among
other things, the Freedom LPs, on behalf of themselves and Washington, added The
Levites  Organization,  one of the two  co-holders of the $225,000  mortgage for
which the  plaintiffs'  complaint  did not seek  foreclosure,  as an  additional
counterclaim defendant,  and the Freedom LPs asserted that both the $100,000 and
$225,000 mortgages are invalid and void ab initio.

After  obtaining  discovery  from the putative  mortgagees,  Washington  and the
Freedom LPs on July 12, 2005 made a motion for summary  judgment  dismissing the
complaint and declaring the mortgages  invalid and void ab initio.  The putative
mortgagees  cross-moved for summary  judgment  declaring the mortgages valid and
enforceable.  Subsequently,  by decision dated January 3, 2006, the Court denied
both  motions,  finding  that  questions  of  fact  exist  for  trial  as to the
reasonableness of the putative mortgagees' reliance on BUFNY.

                                       9
<PAGE>

On February 14, 2006,  the Freedom LPs filed a notice of appeal from the January
3, 2006 decision.

On July 18,  2006,  the  Freedom  LPs  perfected  their  appeal from the Court's
January 3, 2006 decision.

Item 4.  Submission of Matters to a Vote of Stockholders

None


                                       10
<PAGE>

                                     PART II


Item 5. Market for the Registrant's  Common Equity,  Related Stockholder Matters
and Issuer Purchases of Equity Securities

As of March 31, 2007,  the  Partnership  had issued and has  outstanding  72,896
Limited Partnership  Interests,  each representing a $1,000 capital contribution
to the Partnership, or an aggregate capital contribution of $72,896,000.  All of
the issued and  outstanding  Limited  Partnership  Interests have been issued to
Freedom Assignor Inc. (the "Assignor Limited Partner"), which has in turn issued
72,896  BACs to the  purchasers  thereof  for an  aggregate  purchase  price  of
$72,896,000.  Each BAC  represents  all of the economic and virtually all of the
ownership  rights  attributable  to a Limited  Partnership  Interest held by the
Assignor  Limited  Partner.  BACs  may be  converted  into  Limited  Partnership
Interests at no cost to the holder (other than the payment of transfer costs not
to  exceed  $100),  but  Limited  Partnership  Interests  so  acquired  are  not
thereafter  convertible into BACs. As of May 25, 2007, the Partnership has 4,022
registered holders of an aggregate of 72,896 BACs.

Neither  the  BACs nor the  Limited  Partnership  Interests  are  traded  on any
established  trading market. The Partnership does not intend to include the BACs
for  quotation  on NASDAQ or for  listing  on any  national  or  regional  stock
exchange or any other  established  securities  market.  The Revenue Act of 1987
contained  provisions  which have an adverse  impact on  investors  in "publicly
traded   partnerships."   Accordingly,   the  General   Partners   have  imposed
restrictions   limiting  the   transferability  of  the  BACs  and  the  Limited
Partnership  Interests  in secondary  market  transactions.  These  restrictions
should  prevent a public  trading market from  developing  that would  adversely
affect the ability of an investor to liquidate his or her investment quickly. It
is expected that such procedures will remain in effect until such time, if ever,
as further  revision of the Revenue  Act of 1987 may permit the  Partnership  to
lessen the scope of the restrictions.

All  of  the  Partnership's  general  partnership  interests,   representing  an
aggregate capital contribution of $2,000, are held by the two General Partners.

There are no material  restrictions in the Partnership  Agreement on the ability
of the Partnership to make  distributions.  The Partnership  does not anticipate
providing cash distributions to its BACs holders other than from net refinancing
or sales  proceeds.  There can be no assurance as to when the  Partnership  will
dispose of its  remaining  investments  or the amount of  proceeds  which may be
received.  However,  based on the  historical  operating  results  of the  Local
Partnerships and the current economic conditions, including changes in tax laws,
it is unlikely  that the proceeds  from such sales  received by the  Partnership
will be sufficient to return to the limited partners their original investments.
During  the  fiscal  year  ended  March 31,  2007,  distributions  from sales of
approximately  $6,925,000  were made to the BACs  holders  and of  approximately
$70,000 to the General Partners.

Transfer Procedures
-------------------
The Partnership  from time to time receives  requests by unit holders and others
to transfer BACs and/or Limited Partnership  Interests.  Such requests may occur
in connection  with tender  offers for the  Partnership's  units.  Such requests
implicate  the  Partnership's   policies  and  procedures  concerning  transfers
generally and tender offers in particular, which were adopted by the Partnership
pursuant to the terms of its Partnership  Agreement,  to ensure  compliance with
applicable  law,  avoid adverse tax  consequences  for the  Partnership  and its
investors, and preserve the Partnership's advantageous tax status.

In prior years,  the  Partnership  relied on the 5% safe harbor  established  by
Internal Revenue Service ("IRS")  regulations to avoid being  characterized as a
"publicly-traded  partnership"  that  is  taxed  as a  corporation.  The 5% safe
harbor,  however,  expired and is no longer  available  as of December 31, 2005.
Accordingly,  the  Partnership  now relies on a 2% safe  harbor  established  by
another  IRS  regulation  to avoid  being  characterized  as a  "publicly-traded
partnership" that is taxed as a corporation.

A brief  summary of certain of the  Partnership's  key  policies,  practices and
requirements with respect to transfers and tender offers is as follows:

     o    No transfer  (whether for  substitution,  assignment  or otherwise) is
          effective  or  binding  on the  Partnership  unless  and  until  it is
          approved by the General Partners.

     o    No transfer  will be approved  unless the  transferor  and  transferee
          submit complete and properly  executed forms of the  Partnership's own
          transfer  documentation.  The  Partnership  does not  accept  forms of
          transfer  documentation  other  than  its  own  and  does  not  accept
          signatures made by power of attorney in lieu of original signatures by
          each of the transferors and transferees.

     o    The  Partnership  will not approve  transfers  that in the  cumulative
          aggregate  for any tax year  exceed the IRS 2% safe  harbor,  unless a
          financially  responsible  person  provides  the  Partnership  and  its
          partners  with (i) an  indemnity  (in form and  substance  in all ways
          acceptable  to the General  Partners)  for all  liability  (including,
          without  limitation,  any adverse tax  consequences)  arising  from or
          relating to exceeding  the 2% safe harbor and (ii) a legal opinion (in
          form and  substance in all ways  acceptable  to the General  Partners)
          that there will be no adverse tax  consequences to the Partnership and
          its partners from exceeding the 2% safe harbor.

     o    In order to avoid  the  undesirable  situation  of one or more  tender
          offers  consuming the entire safe harbor  limitation  early in the tax
          year  and  leaving  the  Partnership's  remaining  investors  with  no
          liquidity  opportunity  for the rest of that tax year, the Partnership
          restricts the cumulative aggregate total of transfers made pursuant to
          all tender offers to 1.5% of its  outstanding  units in each tax year,
          unless a financially  responsible  person conducting such tender offer
          provides  the  Partnership  with an  acceptable  indemnity  and  legal
          opinion of the type described  above. At the end of each tax year, the
          General  Partners,  in its discretion,  may allow the cumulative total
          number of transfers  (including those by tender offer) to reach the 2%
          safe harbor limit.

     o    The  Partnership  requires  that all  tender  offers  for its units be
          conducted in accordance  with all applicable  law  including,  without
          limitation, the federal securities laws.

The foregoing is solely a summary of the  Partnership's  policies,  requirements
and  practices  with  respect to  transfers  and tender  offers.  More  complete
information,  including  a copy  of  the  Partnership's  transfer  documentation
package, may be obtained from the Partnership.

                                       11
<PAGE>

Item 6. Selected Financial Data.

The  information  set  forth  below  presents  selected  financial  data  of the
Partnership.  Additional  financial  information  is set  forth  in the  audited
consolidated financial statements in Item 8 hereof.
<TABLE>
<CAPTION>
                                                              Years Ended March 31,
                                    ---------------------------------------------------------------------------
           OPERATIONS                   2007           2006*           2005*           2004*           2003*
---------------------------------   ------------   ------------   -------------   -------------   -------------
<S>                                 <C>            <C>            <C>             <C>             <C>
Revenues                            $  6,526,768   $  6,433,900   $   6,241,975   $   6,077,701   $   5,725,218

Operating expenses                    (8,191,697)    (8,523,399)     (7,935,337)     (7,967,565)     (7,556,969)
                                    ------------   ------------   -------------   -------------   -------------

Loss from operations before
 minority interest                    (1,664,929)    (2,089,499)     (1,693,362)     (1,889,864)     (1,831,751)

Minority interest in loss of
 subsidiaries from operations             12,796         13,180           7,176          10,827          11,442
                                    ------------   ------------   -------------   -------------   -------------

Loss from operations                  (1,652,133)    (2,076,319)     (1,686,186)     (1,879,037)     (1,820,309)

Income (loss) from discontinued
 operations including minority
 interest)(Note 11)                   13,484,294     (1,715,725)     (2,533,452)     (1,875,927)     (1,933,438)
                                    ------------   ------------   -------------   -------------   -------------

Net income (loss)                   $ 11,832,161   $ (3,792,044)  $  (4,219,638)  $  (3,754,964)  $  (3,753,747)
                                    ============   ============   =============   =============   =============

Loss from operations per BAC        $     (22.43)  $     (28.20)  $      (22.90)  $      (25.52)  $      (24.72)

Income (loss) from discontinued
 operations per BAC                       183.13         (23.30)         (34.41)         (25.48)         (26.26)
                                    ------------   ------------   -------------   -------------   -------------

Net income (loss)per BAC            $     160.70   $     (51.50)  $      (57.31)  $      (51.00)  $      (50.98)
                                    ============   ============   =============   =============   =============
<CAPTION>


                                                                    March 31,
                                    ---------------------------------------------------------------------------
       FINANCIAL POSITION               2007           2006           2005            2004            2003
---------------------------------   ------------   ------------   -------------   -------------   -------------
<S>                                 <C>            <C>            <C>             <C>             <C>
Total assets                        $ 34,744,362   $ 79,514,396   $  85,974,318   $  89,939,866   $  93,667,833
                                    ============   ============   =============   =============   =============

Mortgage notes payable (including
 assets held for sale)              $ 25,276,141   $ 59,865,761   $  65,119,347   $  66,285,158   $  67,366,819
                                    ============   ============   =============   =============   =============

Total liabilities                   $ 30,941,275   $ 82,460,679   $  80,056,413   $  79,841,161   $  79,736,876
                                    ============   ============   =============   =============   =============

Total partners' capital (deficit)   $  3,130,714   $ (5,914,946)  $  (2,122,902)  $   2,096,736   $   5,851,700
                                    ============   ============   =============   =============   =============
</TABLE>

* Reclassified for comparative purposes.


During the years  ended March 31,  2003,  2004 and 2005 total  assets  decreased
primarily due to depreciation, partially offset by net additions to property and
equipment.  During the years  ended March 31,  2006 and 2007,  total  assets and
liabilities decreased primarily due to the sale of Local Partnerships.

                                       12
<PAGE>

Item 7. Management's  Discussion and Analysis of Financial Condition and Results
of Operations

Liquidity and Capital Resources
-------------------------------

General
-------

The   Partnership's   capital  was  originally   invested  in  forty-two   Local
Partnerships.  As of March 31, 2007,  the limited  partnership  interest in nine
Local  Partnerships  and the property and the related assets and  liabilities of
thirteen Local  Partnerships  have been sold. For a discussion of these sales of
the Local Partnerships,  see Note 9 in Item 8. Subsequently,  on April 30, 2007,
six Local  Partnerships  entered into  agreements to sell their property and the
related assets and liabilities,  and on May 3, 2007, the  Partnership's  limited
partnership interest in one Local Partnership was sold (see Item 8, Note 13).

During the year ended March 31, 2007, the primary sources of liquidity  included
working capital,  interest earned on working capital, and distributions received
from the Local Partnerships.

Short-Term
----------

The  Partnership's  primary  sources  of funds  included:  (i)  working  capital
reserves;  (ii)  interest  earned on the working  capital  reserves;  (iii) cash
distributions from operations of the Local Partnerships; and (iv) sales proceeds
and distributions.  Such funds,  although minimal (other than sales proceeds and
sales distributions),  are available to meet the obligations of the Partnership.
The Partnership does not anticipate providing cash distributions to BACs holders
in circumstances  other than refinancing or sales.  During the years ended March
31, 2007, 2006 and 2005,  distributions from the Local Partnerships  amounted to
approximately $54,000, $24,000 and $138,000, respectively.  Additionally, during
the  years  ended  March  31,  2007,  2006 and 2005,  the  Partnership  received
approximately $13,059,000, $2,379,000 and $0, respectively, of proceeds from the
sale of investments.

Certain fees and expense  reimbursements  owed to the General Partners amounting
to  approximately  $2,983,000 and $9,051,000 were accrued and unpaid as of March
31, 2007 and 2006, respectively. In particular, partnership management fees owed
to the General  Partners  amounting to  approximately  $2,948,000 and $7,555,000
were accrued and unpaid as of March 31, 2007 and 2006, respectively.  During the
year ended March 31, 2007,  management deemed the unpaid partnership  management
fees that were related to sold properties  uncollectible and, as a result, wrote
them off in the  amount of  approximately  $4,096,000,  resulting  in a non-cash
General  Partner   contribution  of  the  same  amount.   Furthermore,   expense
reimbursements  and asset monitoring fees owed to the General Partners amounting
to approximately  $35,000 and $1,496,000 were accrued and unpaid as of March 31,
2007 and 2006,  respectively.  Without the General  Partners'  continued accrual
without payment of the partnership  management fees, the Partnership will not be
in the position to meet its obligations. The General Partners and certain of its
affiliates  have  allowed for the  accrual  without  payment of the  partnership
management fees but are under no obligation to continue to do so.

During  the  year  ended  March  31,  2007,  cash and  cash  equivalents  of the
Partnership  and its  thirty-nine  Local  Partnerships  increased  approximately
$1,229,000 due to proceeds from sale of investments of approximately $39,497,000
and an  increase  due to Local  general  partners  and  affiliates  relating  to
financing activities of approximately  $54,000,  which exceeded net cash used in
operating  activities  of  approximately  $3,967,000,  capital  improvements  of
approximately  $949,000,  costs  paid  relating  to the  sale of  properties  of
approximately  $1,788,000,  a  decrease  in due to local  general  partners  and
affiliates   relating  to  financing   activities  of  approximately   $576,000,
repayments of mortgage  loans of  approximately  $22,872,000,  distributions  of
approximately  $6,995,000  and a  decrease  in  capitalization  of  consolidated
subsidiaries  attributable  to minority  interest of  approximately  $1,174,000.
Included  in the  adjustments  to  reconcile  the net  income  to  cash  used in
operating   activities  is  depreciation   and   amortization  of  approximately
$2,567,000,  income on sale of investments of approximately $10,091,000 and loss
on impairment of fixed assets of approximately $1,506,000.

Total  expenses  for the years ended March 31,  2007,  2006 and 2005,  excluding
depreciation and amortization, interest and general and administrative - related
parties, totaled $3,998,020, $3,940,297 and $3,475,403,  respectively.  Accounts
payable  and other  liabilities  totaled  $1,350,713  and  $5,291,827,  which is
comprised of the following amounts:
<TABLE>
<CAPTION>
                                                             March 31,
                                                   -----------------------------
                                                       2007             2006
                                                   ------------     ------------
<S>                                                <C>              <C>
Deferred revenue from sale of properties           $          0     $  1,888,040
Accounts payable                                        534,287        1,488,252
Accrued interest payable                                579,535        1,555,015
Security deposits payable                               236,891          360,520
                                                   ------------     ------------
Total accounts payable and other liabilities       $  1,350,713     $  5,291,827
                                                   ============     ============
</TABLE>

Accounts payable are short term  liabilities  which are expected to be paid from
operating cash flows,  working capital balances at the Local Partnership  level,
Local General Partner  advances and in certain  circumstances  advances from the
Partnership.  Because the provisions of the secondary loans defer the payment of
accrued interest of the respective Local Partnerships,  the Partnership believes
it (and the applicable Local Partnerships) has sufficient  liquidity and ability
to generate cash and to meet existing and known or reasonably likely future cash
requirements over both the short and long term. Included in accounts payable and
other  liabilities  as of March  31,  2007 and  2006  are $0 and  $1,888,040  of
deferred revenue from sales, respectively.

As  indicated  in  the  above  table,   accrued   interest   payable   comprised
approximately  43% and 46% of the total accounts  payable and other  liabilities
amount,  excluding  deferred  revenue  from  sales,  at March 31, 2007 and 2006,
respectively. Such amount represents the accrued interest on all mortgage loans,
which  include  primary  and  secondary  loans.  Certain  secondary  loans  have
provisions  such that  interest is accrued but not payable  until a future date.

                                       13
<PAGE>

The  Partnership  anticipates  the payment of accrued  interest on the secondary
loans  (which  make up the  majority  of the  accrued  interest  payable  amount
indicated  in the  above  table  and  which  have  been  accumulating  since the
Partnership's investment in the respective Local Partnerships) will be made from
future refinancings or sales proceeds of the respective Local  Partnerships.  In
addition, each Local Partnership's mortgage notes are collateralized by the land
and  buildings of the  respective  Local  Partnership,  and are without  further
recourse to the Partnership.

Security  deposits payable are offset by cash held in security  deposits,  which
are included in "Cash held in escrow" on the consolidated financial statements.

Working capital of approximately  $4,998,000,  exclusive of Local  Partnerships'
working  capital,  remains  as of March 31,  2007.  It is used to pay  operating
expenses of the Partnership,  including  Partnership  management fees payable to
the General Partners and advances to Local Partnerships if warranted.

Long-Term
----------

Effective January 1, 1999 the State of California  requires owners of a property
benefiting from the Federal  Housing  Administration  ("FHA") insured  mortgages
under  Section  236 or  221(a)(3)  to  provide a nine month  notice of  contract
termination or prepayment of the FHA insured loan. In addition,  with respect to
the Partnership's  California  investments,  the owner must offer the Properties
for sale to those  entities  who agree to maintain  the  Property as  affordable
housing.

On October 20, 1999 President  Clinton signed the Fiscal Year 2000 Department of
Veteran  Affairs,   HUD  and  Independent   Agencies   Appropriations  Act  (the
"Appropriations   Act").  The  Appropriations  Act  contains  revisions  to  HUD
Mark-to-Market Program and other HUD programs concerning the preservation of HUD
housing stock. On December 29, 1999 HUD issued Notice H99-36 addressing "Project
Based Section 8 Contracts  Expiring in Fiscal Year 2000," reflecting the changes
in the  Appropriations  Act and  superceding  earlier HUD Notices 98-34,  99-08,
99-15, 99-21 and 99-32. Notice 99-36 clarifies many of the earlier uncertainties
with respect to the earlier HUD Section 8 Mark-to-Market  Programs and continued
the  Mark-to-Market  Program  which  allows  owners with  Section 8 contracts to
increase the rents to market levels where  contract  rents are  currently  below
market. As of March 31, 2007, none of the Local  Partnerships has opted to enter
the Mark-to-Market Program and therefore this has no impact on the Partnership.

For a discussion of contingencies affecting certain Local Partnerships, see Note
10 in Item 8. Since the maximum loss the Partnership  would be liable for is its
net  investment in the  respective  Local  Partnerships,  the  resolution of the
existing   contingencies   is  not  anticipated  to  impact  future  results  of
operations,  liquidity or financial  condition in a material way.  However,  the
Partnership's  loss of its  investment  in a Local  Partnership  may  result  in
recapture of Tax Credits if the  investment is lost before the expiration of the
applicable Compliance Period.

Except as  described  above,  management  is not aware of any  trends or events,
commitments or uncertainties, which have not otherwise been disclosed, that will
or are likely to impact  liquidity in a material  way.  Management  believes the
only impact would be from laws that have not yet been adopted.  The portfolio is
diversified by the location of the  Properties  around the United States so that
if one  area of the  country  is  experiencing  downturns  in the  economy,  the
remaining  Properties  in the  portfolio  may  not  be  affected.  However,  the
geographic  diversification  of the portfolio may not protect  against a general
downturn in the national economy.

Sale of Underlying Properties/Local Partnership Interests
---------------------------------------------------------

For a discussion of the sale of properties in which the Partnership  owns direct
and indirect interests, see Note 9 in Item 8.

Discontinued Operations
-----------------------

The Partnership is currently in the process of disposing of its investments. The
disposals  meet the  criteria  established  for  recognition  as a  discontinued
operation  under SFAS No.  144.  SFAS No. 144  specifically  requires  that such
amounts must differentiate a component of a business comprised of operations and
cash flows that can be clearly  distinguished  operationally  and for  financial
reporting  purposes,  from  the rest of the  entity.  See Note 9 in Item 8 for a
discussion of the sale of properties. As of March 31, 2007, there were no assets
held for sale.

Tabular Disclosure of Contractual Obligations
---------------------------------------------

The following table summarizes the Partnership's  commitments from operations as
of March 31, 2007 to make future  payments  under its debt  agreements and other
contractual obligations.
<TABLE>
<CAPTION>
                                           Less than       1 - 3         3 -5        More than
                               Total        1 Year         Years         Years        5 Years
                            -----------   -----------   -----------   -----------   -----------
<S>                         <C>           <C>           <C>           <C>           <C>
Mortgage notes payable (a)  $25,276,141   $ 2,107,086   $   538,682   $   618,170   $22,012,203
</TABLE>

(a)  The  mortgage  notes are  payable  in  aggregate  monthly  installments  of
     approximately  $167,000 including principal and interest with rates varying
     from 1% to 13.50%  per  annum and have  maturity  dates  ranging  from 2007
     through 2042. The loans are collateralized by the land and buildings of the
     subsidiary partnerships, the assignment of certain subsidiary partnerships'
     rents, leases, and replacement reserves, and are without further recourse.


Off Balance Sheet Arrangements
------------------------------

The Partnership has no off-balance sheet arrangements.

                                       14
<PAGE>

Critical Accounting Estimates
-----------------------------

In  preparing  the  consolidated  financial  statements,   management  has  made
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities  at the  date  of the  consolidated  financial  statements  and  the
reported amounts of revenues and expenses during the reporting  periods.  Actual
results could differ from those  estimates.  Set forth below is a summary of the
accounting  policies that management believes are critical to the preparation of
the consolidated financial statements.

Property and Equipment/Valuation of Long-Lived Assets
-----------------------------------------------------

Property and  equipment  to be held and used are carried at cost which  includes
the purchase price,  acquisition fees and expenses, and any other costs incurred
in acquiring the  Properties.  The cost of property and equipment is depreciated
over their estimated useful lives using accelerated and  straight-line  methods.
Expenditures  for repairs and  maintenance  are charged to expense as  incurred;
major  renewals  and  betterments  are  capitalized.  At the time  property  and
equipment  are  retired  or  otherwise  disposed  of,  the cost and  accumulated
depreciation  are  eliminated  from  the  assets  and  accumulated  depreciation
accounts  and the profit or loss on such  disposition  is reflected in earnings.
The  Partnership  complies  with SFAS No. 144. A loss on impairment of assets is
recorded when management estimates amounts recoverable through future operations
and sale of the property on an undiscounted basis are below depreciated cost. At
that time property  investments  themselves  are reduced to estimated fair value
(generally  using  discounted  cash flows) when the property is considered to be
impaired and the depreciated cost exceeds estimated fair value.

In  accordance  with SFAS No. 144, the results of  discontinued  operations  are
reported as a separate  component of income  before  extraordinary  items on the
consolidated  statements  of  operations.  Discontinued  operations  include the
results of operations  and any gain or loss  recognized  for Local  Partnerships
that have been  disposed of or are held for sale. A gain or loss  recognized  on
the disposal is disclosed in the notes to the consolidated financial statements.
Adjustments  to amounts  previously  reported in  operations  that are  directly
related to the disposal of a Local  Partnership are  reclassified in the current
period  as  discontinued  operations  for  comparability  purposes.  Assets  and
liabilities  of a Local  Partnership  that are  classified  as held for sale are
presented separately in the asset and liability sections,  respectively,  of the
consolidated balance sheets.

Through March 31, 2007, the Partnership has recorded approximately $5,726,000 as
a loss on impairment of assets or reductions to estimated fair value.

Revenue Recognition
-------------------

Rental income is earned  primarily under standard  residential  operating leases
and is typically  due the first day of each month,  but can vary by Property due
to the terms of the tenant leases.  Rental income is recognized  when earned and
as rents become due and charged to tenants' accounts  receivable if not received
by the due  date.  Rental  payments  received  in  advance  of the due  date are
deferred until earned.

Rental subsidies are recognized as rental income during the month in which it is
earned. The Partnership  received rental subsidies which amounted to $2,976,343,
$3,430,948  and  $3,488,027  for the years ended March 31, 2007,  2006 and 2005,
respectively.  The related rental subsidy  programs have  expiration  dates that
terminate upon total disbursement of the assistance obligation.

Other  revenues are  recorded  when earned and consist of the  following  items:
Interest  income  earned on cash and cash  equivalent  balances and cash held in
escrow balances,  income from forfeited security deposits, late charges, laundry
and vending income and other rental related items.

Other  revenues  from  operations  include  the  following  amounts  at both the
Partnership and Local Partnership level:
<TABLE>
<CAPTION>
                                                      March 31,
                                      ------------------------------------------
                                         2007            2006*           2005*
                                      ----------      ----------      ----------
<S>                                   <C>             <C>             <C>
Interest                              $  373,757      $   51,045      $   19,832
Other                                    916,833       1,060,399         925,821
                                      ----------      ----------      ----------

   Total other revenue                $1,290,590      $1,111,444      $  945,653
                                      ==========      ==========      ==========
</TABLE>

Other revenues from  discontinued  operations  include the following  amounts at
both the Partnership and Local Partnership level:
<TABLE>
<CAPTION>
                                                      March 31,
                                      ------------------------------------------
                                         2007            2006*           2005*
                                      ----------      ----------      ----------
<S>                                   <C>             <C>             <C>
Interest                              $   38,940      $   54,056      $  127,023
Other                                    274,656         558,339         475,248
                                      ----------      ----------      ----------

   Total other revenue                $  313,596      $  612,395      $  602,271
                                      ==========      ==========      ==========
</TABLE>

*  Reclassified for comparative purposes.

                                       15
<PAGE>

Related Parties
---------------

Under the terms of the  Partnership  Agreement,  the General  Partners and their
affiliates  are  entitled  to  receive  compensation  from  the  Partnership  in
consideration of certain  services  rendered to the Partnership by such parties.
In  addition,  the  General  Partners  collectively  hold a 1%  interest  in all
profits, losses and distributions  attributable to operations and a subordinated
15%  interest  in such items  attributable  to sales and  refinancings.  Certain
directors and officers of the General  Partners  receive  compensation  from the
General  Partners  and their  affiliates  for  services  performed  for  various
affiliated  entities which may include  services  performed for the Partnership.
The maximum annual  partnership  management fee paid to the General  Partners is
0.5% of invested assets.  See Note 7 in Item 8, which is incorporated  herein by
reference.

Results of Operations
---------------------

Property and  equipment  to be held and used are carried at cost which  includes
the purchase price, acquisition fees and expenses,  construction period interest
and any other costs incurred in acquiring the  Properties.  The cost of property
and equipment is depreciated over their estimated useful lives using accelerated
and straight-line methods.  Expenditures for repairs and maintenance are charged
to expense as incurred;  major renewals and betterments are capitalized.  At the
time property and  equipment are retired or otherwise  disposed of, the cost and
accumulated   depreciation  are  eliminated  from  the  assets  and  accumulated
depreciation accounts and the profit or loss on such disposition is reflected in
earnings.  A loss on impairment of assets is recorded when management  estimates
amounts  recoverable  through  future  operations and sale of the property on an
undiscounted basis are below depreciated cost. At that time Property investments
themselves  are reduced to  estimated  fair value  (generally  using  discounted
estimated  future cash flows) when the Property is considered to be impaired and
the carrying value exceeds estimated fair value.

During the years  ended  March 31,  2007,  2006 and 2005,  the  Partnership  has
recorded approximately $1,506,000,  $555,000 and $0, respectively,  as a loss on
impairment of assets.  Through March 31, 2007, the  Partnership  has recorded an
aggregate of approximately $5,726,000 of losses on impairment of assets.

The  Partnership's  primary source of income  continues to be rental income with
the  corresponding  expenses being divided among  operations,  depreciation  and
mortgage interest.

2007 vs. 2006
-------------

Rental income  decreased  approximately  2% for the year ended March 31, 2007 as
compared  to 2006,  primarily  due to a decrease  in rental  income at one Local
Partnership  affected by Hurricane  Katrina  partially  offset by an increase in
rental rates at the remaining Local Partnerships.

Other income increased  approximately $179,000 for the year ended March 31, 2007
as compared to 2006,  primarily due to an increase in interest  income earned at
the  Partnership  level due to higher cash balances  resulting  from the sale of
properties  partially  offset by a management  fee  received at the  Partnership
level from the sale of one Local Partnership in the prior year.

Total expenses,  excluding repairs and maintenance,  general and  administrative
and general and administrative-related  parties, remained fairly consistent with
a slight  increase of less than 1% for the year ended March 31, 2007 as compared
to 2006.

Repairs and maintenance expenses decreased  approximately  $276,000 for the year
ended  March 31,  2007 as  compared  to 2006,  primarily  due to a  decrease  in
contract and  maintenance  expenses at three Local  Partnerships,  a decrease in
repairs  due to fire damage in 2006 at one Local  Partnership  and a decrease in
maintenance   expenses  due  to  temporarily  ceased  operations  at  one  Local
Partnership  affected by Hurricane  Katrina,  partially offset by an increase in
grounds  maintenance,  plumbing  and  interior  repair  expenses  at  two  Local
Partnerships.

General and  administrative  expenses increased  approximately  $329,000 for the
year ended March 31, 2007 as compared to 2006,  primarily  due to an increase in
legal fees relating to sales activity and the Washington litigation (see Item 8,
Note 10) and an increase in accounting fees due to the Public Company Accounting
Oversight Board  requirements at the Partnership level, an increase in legal and
partnership  expenses at one Local Partnership,  an increase in office expenses,
administrative   salaries  and  payroll  taxes  at  a  second  and  third  Local
Partnership  and an  increase  in  consulting  fees due to a tax credit  renewal
process at a fourth Local Partnership.

General and  administrative - related parties expenses  decreased  approximately
$408,000 for the year ended March 31, 2007 as compared to 2006, primarily due to
a decrease in partnership  management fees and expense  reimbursement charges at
the  Partnership  level resulting from the sale of properties and a decrease due
to temporarily ceased operations at one Local Partnership.

2006 vs. 2005
-------------

Rental  income  increased  less than 1% for the year  ended  March  31,  2006 as
compared to 2005,  primarily  due to an annual  increase in rental  rates at the
Local  Partnerships  partially  offset by an increase in vacancies due to damage
from Hurricane Katrina at one Local Partnership.

Other income increased  approximately $166,000 for the year ended March 31, 2006
as  compared  to  2005,  primarily  due  to a  management  fee  received  at the
Partnership level from the sale of one Local Partnership.

Total expenses, excluding repairs and maintenance,  operating and other, general
and administrative, remained fairly consistent with an increase of approximately
3% for the year ended March 31, 2006 as compared to 2005.

Repairs and maintenance expenses increased  approximately  $150,000 for the year
ended March 31, 2006 as compared to 2005, primarily due to property and building
improvements  at one Local  Partnership,  fire damage  repairs at a second Local
Partnership  and  increases in repair  contracts and  maintenance  salaries at a
third Local Partnership  partially offset by a decrease in maintenance  expenses
at two Local Partnerships.

Operating and other expenses increased approximately $147,000 for the year ended
March 31, 2006 as compared to 2005,  primarily due to an increase in gas expense
at one Local  Partnership  and an  increase in water  expense at a second  Local
Partnership.

                                       16
<PAGE>

General and administrative  increased  approximately $166,000 for the year ended
March 31, 2006 as compared to 2005,  primarily  due to an increase in legal fees
relating to the Washington  Brooklyn legal  proceedings and an increase in sales
activity  at the  Partnership  level  (see Item 8, Note 10) and an  increase  in
management salaries and renting expenses at one Local Partnership.

Other
-----

As of  December  31,  2002,  the  Credit  Period for all of the  Properties  had
expired,  although each Local  Partnership  must continue to comply with the Tax
Credit  requirements  until the end of the  Compliance  Period in order to avoid
recapture of the Tax Credits.  The  Compliance  Periods  will  continue  through
December 31, 2007 with respect to the Properties  depending upon when the Credit
Period commenced.

The Partnership's  investments as limited partners in the Local Partnerships are
subject to the risks  incident to the  management and ownership of improved real
estate.  The Partnership's  investments also could be adversely affected by poor
economic  conditions  generally,  which could increase  vacancy  levels,  rental
payment defaults and operating expenses,  any or all of which could threaten the
financial viability of one or more of the Local Partnerships.

There are also  substantial  risks  associated  with the  operation of Apartment
Complexes   receiving   government   assistance.   These  include   governmental
regulations  concerning tenant eligibility,  which may make it more difficult to
rent apartments in the complexes;  difficulties in obtaining government approval
for rent  increases;  limitations  on the  percentage  of  income  which low and
moderate income tenants may pay as rent; the  possibility  that Congress may not
appropriate  funds to enable HUD to make the rental  assistance  payments it has
contracted to make; and that when the rental  assistance  contracts expire there
may not be  market  demand  for  apartments  at  full  market  rents  in a Local
Partnership's  Apartment  Complex.  As of March 31, 2007, there were three Local
Partnerships subsidized by HUD.

The Local  Partnerships  are impacted by inflation  in several  ways.  Inflation
generally  allows for  increases in rental rates to reflect the impact of higher
operating and replacement  costs.  Inflation also affects the Local Partnerships
adversely  by  increasing  operating  costs as a result of higher  costs of such
items as fuel, utilities and labor.  However,  continued inflation may result in
appreciated values of the Local Partnerships'  Apartment Complexes over a period
of time as rental revenues and replacement costs continue to increase.

The  Partnership  does not anticipate that it will be in a position to make cash
distributions other than from refinancing and the disposition of the Properties.
There  can be no  assurance  as to when  the  Partnership  will  dispose  of its
remaining investments or the amount of proceeds which may be received.  However,
based on the  historical  operating  results of the Local  Partnerships  and the
current economic conditions,  including changes in tax laws, it is unlikely that
the proceeds from such sales received by the  Partnership  will be sufficient to
return to the limited  partners  their original  investments.  During the fiscal
year ended March 31, 2007,  distributions from sales of approximately $6,925,000
were  made to the BACs  holders  and of  approximately  $70,000  to the  General
Partners.

Item 7a. Quantitative and Qualitative Disclosures about Market Risk

The  Partnership  has  mortgage  notes  that are  payable in  aggregate  monthly
installments including principal and interest at rates varying from 1% to 13.50%
per annum.  The Partnership does not believe there is a material risk associated
with the  various  interest  rates  associated  with the  mortgage  notes as the
majority  of  the  Local  Partnership  mortgage  notes  have  fixed  rates.  The
Partnership  currently  discloses in Item 8, Note 3 of the Notes to Consolidated
Financial  Statements,  the  fair  value  of the  mortgage  notes  payable.  The
Partnership does not have any other market sensitive instruments.

                                       17
<PAGE>

Item 8. Financial Statements and Supplementary Data
                                                                      Sequential
                                                                         Page
                                                                      ----------

        Consolidated Financial Statements

        Report of Independent Registered Public Accounting Firm           19

        Consolidated Balance Sheets as of March 31, 2007 and 2006         47

        Consolidated Statements of Operations for the years ended
         March 31, 2007, 2006 and 2005                                    48

        Consolidated Statements of Changes in Partners' Capital
         (Deficit) for the years ended March 31, 2007, 2006 and
          2005                                                            49

        Consolidated Statements of Cash Flows for the years ended
         March 31, 2007, 2006 and 2005                                    50

        Notes to Consolidated Financial Statements                        51

                                       18
<PAGE>

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM






TO THE PARTNERS OF FREEDOM TAX CREDIT PLUS L.P.



         We have audited the accompanying consolidated balance sheets of FREEDOM
TAX CREDIT PLUS L.P.  AND  SUBSIDIARIES  as of March 31, 2007 and 2006,  and the
related  consolidated  statements of  operations,  changes in partners'  capital
(deficit)  and cash flows for each of the years in the  three-year  period ended
March 31, 2007. These consolidated  financial  statements are the responsibility
of the Partnership's management.  Our responsibility is to express an opinion on
these  financial   statements  based  on  our  audits.  We  did  not  audit  the
consolidated financial statements of twenty-eight subsidiary partnerships, whose
losses aggregated $3,322,175 for the year ended March 31, 2007, and whose assets
constituted 80% of consolidated  assets at March 31, 2007. Those statements were
audited by other  auditors  whose  reports  have been  furnished  to us, and our
opinion,  insofar as it relates to the  amounts  included  for these  subsidiary
partnerships, is based solely on the reports of the other auditors.

         We conducted our audits in accordance  with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain  reasonable  assurance about whether the
financial  statements  are free of  material  misstatement.  An  audit  includes
examining,  on a test basis,  evidence supporting the amounts and disclosures in
the  financial  statements.  An audit also  includes  assessing  the  accounting
principles  used  and  significant  estimates  made  by  management,  as well as
evaluating the overall  financial  statement  presentation.  We believe that our
audits and the reports of the other auditors  provide a reasonable basis for our
opinion.

         In our  opinion,  based on our  audits  and the  reports  of the  other
auditors,  the  consolidated  financial  statements  referred  to above  present
fairly, in all material  respects,  the financial position of FREEDOM TAX CREDIT
PLUS L.P.  AND  SUBSIDIRAIES  as of March 31, 2007 and 2006,  and the results of
their  operations  and their cash flows for each of the years in the  three-year
period ended March 31, 2007, in conformity with accounting  principles generally
accepted in the United States of America.



/s/ Friedman LLP
New York, New York
June 18, 2007

                                       19
<PAGE>

INDEPENDENT ACCOUNTANTS' REPORT

To the Partners of
Ivanhoe Apartments Limited Partnership

We have audited the  accompanying  balance sheet of Ivanhoe  Apartments  Limited
Partnership (a Limited Partnership) as of January 31, 2006 and December 31, 2005
and the related statements of operations,  changes in partners' capital and cash
flows for the month ended January 31, 2006 and the year ended December 31, 2005.
These  financial   statements  are  the   responsibility  of  the  Partnership's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.

We conducted  our audit in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material  misstatement.  The  Partnership  has determined
that it is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting.  Our audit included  consideration of
internal  control  over  financial  reporting  as a basis  for  designing  audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Partnership's internal control
over  financial  reporting.  Accordingly,  we express no such opinion.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements.  An audit also includes  assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation.  We believe that our
audits provide a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the financial  position of Ivanhoe  Apartments  Limited
Partnership  at January 31, 2006 and December  31, 2005,  and the results of its
operations  and cash flows for the month  ended  January  31,  2006 and the year
ended  December 31, 2005, in conformity  with  accounting  principles  generally
accepted in the United States of America.



/s/ Lake, Hill & Myers
Salt Lake City, Utah
February 6, 2007

                                       20
<PAGE>

[Letterhead of KOCH GROUP & COMPANY, LLP]

INDEPENDENT AUDITOR'S REPORT

To the Partners
Washington Brooklyn Limited Partnership

We have audited the accompanying  balance sheets of Washington  Brooklyn Limited
Partnership  (A Limited  Partnership)  as of December  31, 2006 and 2005 and the
related statements of operations, changes in partners' equity and cash flows for
the years then ended.  These financial  statements are the responsibility of the
Partnership's  management.  Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material  misstatement.  The  Partnership  has determined
that it is not required to have, nor we were engaged to perform, an audit of its
internal control over financial reporting.  Our audits included consideration of
internal  control  over  financial  reporting  as a basis  for  designing  audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Partnership's internal control
over  financial  reporting.  Accordingly,  we express no such opinion.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements.  An audit also includes  assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation.  We believe that our
audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly in all
material  respects,  the  financial  position  of  Washington  Brooklyn  Limited
Partnership  (A Limited  Partnership)  as of December  31, 2006 and 2005 and the
results of its  operations,  changes in its partners'  equity and its cash flows
for the years then ended,  in conformity with  accounting  principles  generally
accepted in the United States of America.

/s/ KOCH GROUP & COMPANY, LLP
New York, New York
February 23, 2007

                                       21
<PAGE>

[Letterhead of KOCH GROUP & COMPANY, LLP]

INDEPENDENT AUDITOR'S REPORT

To the Partners
C-H Development Group Associates

We have audited the  statements of operations,  changes in partners'  equity and
cash flows of C-H  Development  Group  Associates  for the  period  January 1 to
October 25, 2006.  These  financial  statements  are the  responsibility  of the
Partnership's  management.  Our responsibility is to express an opinion on these
financial statements based on our audit.

We conducted  our audit in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material  misstatement.  The  Partnership  has determined
that it is not required to have, nor we were engaged to perform, an audit of its
internal control over financial reporting.  Our audit included  consideration of
internal  control  over  financial  reporting  as a basis  for  designing  audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Partnership's internal control
over  financial  reporting.  Accordingly,  we express no such opinion.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements.  An audit also includes  assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation.  We believe that our
audit provides a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all  material  respects,   the  financial  position  of  C-H  Development  Group
Associates operations, changes in partners' equity and cash flows for the period
January 1 to October 25, 2006 in conformity with accounting principles generally
accepted in the United States of America.

/s/ Koch Group & Company, LLP
New York, New York
January 23, 2007

                                       22
<PAGE>

[Letterhead of Haefele Flanagan]

INDEPENDENT AUDITORS' REPORT

To the Partners
Magnolia Mews Limited Partnership
Philadelphia, Pennsylvania

We have  audited  the  accompanying  balance  sheet  of  MAGNOLIA  MEWS  LIMITED
PARTNERSHIP (a  Pennsylvania  Limited  Partnership) as of December 31, 2006, and
the related  statements of operations,  partners' equity, and cash flows for the
year then  ended.  These  financial  statements  are the  responsibility  of the
Partnership's  management.  Our responsibility is to express an opinion on these
financial statements based on our audit.

We conducted  our audit in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement.  An audit includes examining, on a
test basis,  evidence  supporting  the amounts and  disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   We  believe  that  our  audit  provides  a
reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all  material  respects,   the  financial  position  of  MAGNOLIA  MEWS  LIMITED
PARTNERSHIP as of December 31, 2006, and the results of its operations,  changes
in  partners'  equity and its cash  flows for the year then ended in  conformity
with accounting principles generally accepted in the United States of America.

/s/ Haefele Flanagan L.C., p.c.
Moorestown, New Jersey
February 24, 2007

                                       23
<PAGE>

[Letterhead of KOCH GROUP & COMPANY, LLP]

INDEPENDENT AUDITOR'S REPORT

To the Partners
CLM Equities

We have  audited  the  accompanying  balance  sheet of CLM  Equities  (A Limited
Partnership)  as of March 31, 2006 and the  related  statements  of  operations,
changes in  partners'  equity and cash flows for the three  months  then  ended.
These  financial   statements  are  the   responsibility  of  the  Partnership's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audit.

We conducted  our audit in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material  misstatement.  The  Partnership  has determined
that it is not required to have, nor we were engaged to perform, an audit of its
internal control over financial reporting.  Our audit included  consideration of
internal  control  over  financial  reporting  as a basis  for  designing  audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Partnership's internal control
over  financial  reporting.  Accordingly,  we express no such opinion.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements.  An audit also includes  assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation.  We believe that our
audits provide a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all  material  respects,  the  financial  position  of CLM  Equities  (A Limited
Partnership) as of March 31, 2006 and the results of its operations,  changes in
its  partners'  equity  and its cash  flows for the three  months  then ended in
conformity with accounting principles generally accepted in the United States of
America.


/s/ Koch Group & Company, LLP
Certified Public Accountants
New York, New York
October 24, 2006

                                       24
<PAGE>

[Letterhead of Larson, Allen, Weishair & Co., LLP]

INDEPENDENT AUDITOR'S REPORT


To The Partners
Ogontz Hall Investors
Philadelphia, Pennsylvania

We have  audited the  accompanying  balance  sheets of Ogontz Hall  Investors (A
Limited  Partnership)  as of  December  31,  2006  and  2005,  and  the  related
statements of profit and loss, partners' equity (deficit) and cash flows for the
years then ended.  These  financial  statements  are the  responsibility  of the
Partnership's  management.  Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting  Oversight  Board  (United  States) and the  standards  applicable to
financial  audits  contained in  GOVERNMENT  AUDITING  STANDARDS,  issued by the
Comptroller  General of the United States.  Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material  misstatement.  The  Partnership  has determined
that it is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting.  Our audit included  consideration of
internal  control  over  financial  reporting  as a basis  for  designing  audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Partnership's internal control
over  financial  reporting.  Accordingly,  we express no such opinion.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements.  An audit also includes  assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation.  We believe that our
audits provide a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the financial  position of Ogontz Hall  Investors as of
December 31, 2006 and 2005, and the results of its operations and its cash flows
for each of the years  then ended in  conformity  with U.S.  generally  accepted
accounting principles.

In accordance  with  GOVERNMENT  AUDITING  STANDARDS,  we have issued our report
dated March 29, 2007, on our  consideration  of Ogontz Hall Investors'  internal
control over  financial  reporting and our test of its  compliance  with certain
provisions of laws, regulations,  contracts and grant agreements. The purpose of
that report is to describe  the scope of our  testing of internal  control  over
financial  reporting and compliance and the results of that testing,  and not to
provide  an opinion on the  internal  control  over  financial  reporting  or on
compliance.  That report is an integral part of an audit performed in accordance
with  GOVERNMENT  AUDITING  STANDARDS  and should be considered in assessing the
results of our audit.

Our audits were performed for the purpose of forming an opinion on the financial
statements taken as a whole. The accompanying supplementary information on pages
16 to 29 is  presented  for  the  purposes  of  additional  analysis,  including
supplementary  information  required by PHFA,  and is not a required part of the
financial  statements  of  Ogontz  Hall  Investors.  Such  information  has been
subjected to the auditing procedures applied in the audit of the basic financial
statements  and, in our opinion,  is fairly  stated in all material  respects in
relation to the basic financial statements taken as a whole.


/s/ Larson, Allen, Weishair & Co., LLP
Blue Bell, Pennsylvania
March 29, 2007

                                       25
<PAGE>

[Letterhead of Regen, Benz & MacKenzie, C.P.A.'s, P.C.]

INDEPENDENT AUDITORS' REPORT

To the Partners
Nelson Anderson Affordable Housing Limited Partnership

We have audited the  accompanying  balance sheet of Nelson  Anderson  Affordable
Housing Limited  Partnership  from January 1, 2006, to January 19, 2006 (date of
sale), and the related  statements of operations,  changes in partners'  capital
(deficit) and cash flows for the period then ended.  These financial  statements
are the responsibility of the Partnership's management. Our responsibility is to
express an opinion on these financial statements based on our audit.

We conducted  our audit in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material  misstatement.  The  Partnership  has determined
that it is not required to have, nor we were engaged to perform, an audit of its
internal control over financial reporting.  Our audit included  consideration of
internal  control  over  financial  reporting  as a basis  for  designing  audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Partnership's internal control
over  financial  reporting.  Accordingly,  we express no such opinion.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements.  An audit also includes  assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation.  We believe that our
audit provides a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the financial  position of Nelson  Anderson  Affordable
Housing  Limited  Partnership  as of January  19,  2006,  and the results of its
operations,  the changes in partners'  capital  (deficit) and cash flows for the
period then ended, in conformity with generally accepted  accounting  principles
used in the United States of America.


/s/ Regen, Benz & MacKenzie, C.P.A.'s, P.C.
New York, New York
December 8, 2006

                                       26
<PAGE>

[Letterhead of Salmin, Celona, Wehrle & Flaherty, LLP]

INDEPENDENT AUDITOR'S REPORT
----------------------------

To the Partners
Conifer Irondequoit Associates

We have audited the accompanying balance sheet of Conifer Irondequoit Associates
(a limited  partnership)  as of  December  31,  2006 and 2005,  and the  related
statements of operations and partners'  capital (deficit) and cash flows for the
years then ended.  These statements are the  responsibility of the Partnership's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material  misstatement.  The  Partnership  has determined
that it is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting.  Our audit included  consideration of
internal  control  over  financial  reporting  as a basis  for  designing  audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Partnership's internal control
over  financial  reporting.  Accordingly,  we express no such opinion.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements.  An audit also includes  assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation.  We believe that our
audits provide a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the financial position of Conifer Irondequoit Associates
as of December 31, 2006 and 2005, and the results of its operations and its cash
flows  for the  years  then  ended  in  conformity  with  accounting  principles
generally accepted in the United States of America.

The  accompanying  financial  statements  have been  prepared  assuming that the
Partnership  will  continue as a going  concern.  As  discussed in Note 9 to the
financial  statements,  the Partnership has lost a major tenant.  This condition
raises  substantial  doubt about its  ability to  continue  as a going  concern.
Management's plans regarding this matter are described in Note 10. The financial
statements do not include any adjustments  that might result from the outcome of
this uncertainty.

/s/ Salmin, Celona, Wehrle & Flaherty, LLP
Rochester, New York
March 7, 2007

                                       27
<PAGE>

[Letterhead of REZNICK GROUP, P.C.]

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Partners
Middletown Associates

We have audited the  accompanying  balance sheet of Middletown  Associates as of
December  31,  2006,  and the  related  statements  of  operations,  changes  in
partners'  equity  (deficit)  and cash  flows  for the year  then  ended.  These
financial statements are the responsibility of the Partnership's management. Our
responsibility  is to express an opinion on these financial  statements based on
our audit.

We conducted  our audit in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material  misstatement.  The  Partnership  has determined
that it is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting.  Our audit included  consideration of
internal  control  over  financial  reporting  as a basis  for  designing  audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Partnership's internal control
over financial reporting. Accordingly, we express no such opinion. An audit also
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements,  assessing the  accounting  principles
used and  significant  estimates made by  management,  as well as evaluating the
overall financial statement  presentation.  We believe that our audit provides a
reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the financial  position of Middletown  Associates as of
December 31, 2006 and the results of its operations, changes in partners' equity
(deficit)  and its cash  flows  for the year  then  ended,  in  conformity  with
accounting principles generally accepted in the United States of America.

/s/ REZNICK GROUP
Baltimore, Maryland
March 29, 2007

                                       28
<PAGE>

[Letterhead of REZNICK GROUP, P.C.]

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Partners
Lauderdale Lakes Associates, Ltd.

We have audited the accompanying  balance sheets of Lauderdale Lakes Associates,
Ltd. as of December 31, 2006 and 2005, and the related statements of operations,
changes in partners'  equity  (deficit) and cash flows for the years then ended.
These  financial   statements  are  the   responsibility  of  the  Partnership's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement.  An audit includes examining, on a
test basis,  evidence  supporting  the amounts and  disclosures in the financial
statements,  assessing the accounting  principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the financial  position of Lauderdale Lakes Associates,
Ltd. as of December 31, 2006 and 2005,  and the results of its  operations,  the
changes in partners'  equity  (deficit) and cash flows for the years then ended,
in conformity with accounting principles generally accepted in the United States
of America.

Our  audits  were  made for the  purpose  of  forming  an  opinion  on the basic
financial  statements taken as a whole. The supplemental  information on page 19
is presented for purposes of  additional  analysis and is not a required part of
the basic  financial  statements.  Such  information  has been  subjected to the
auditing procedures applied in the audits of the basic financial statements and,
in our  opinion,  is fairly  stated in all  material  aspects in relation to the
basic financial statements taken as a whole.

/s/ Reznick Group, P.C.
Atlanta, Georgia
May 1, 2007

                                       29
<PAGE>

[Letterhead of REZNICK GROUP, P.C.]

INDEPENDENT AUDITORS' REPORT

To the Partners
Flipper Temple Associates, L.P.

We have audited the  accompanying  balance sheet of Flipper  Temple  Associates,
L.P.,  as of December  31,  2006,  and the  related  statements  of  operations,
partners'  equity  (deficit)  and cash  flows  for the year  then  ended.  These
financial statements are the responsibility of the partnership's management. Our
responsibility  is to express an opinion on these financial  statements based on
our audit.

We conducted  our audit in accordance  with the standards of the Public  Company
Accounting  Oversight  Board  (United  States) and the  standards  applicable to
financial  audits  contained in  Government  Auditing  Standards,  issued by the
Comptroller  General of the United States.  Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material  misstatement.  The  Partnership  has determined
that it is not required to have, nor we were engaged to perform, an audit of its
internal control over financial reporting.  Our audit included  consideration of
internal  control  over  financial  reporting  as a basis  for  designing  audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Partnership's internal control
over financial reporting. Accordingly, we express no such opinion. An audit also
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements.  An audit also includes  assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation.  We believe that our
audit provides a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects, the financial position of Flipper Temple Associates, L.P.
as of  December  31,  2006,  and the results of its  operations,  the changes in
partners' equity (deficit) and cash flows for the year then ended, in conformity
with accounting principles generally accepted in the United States of America.

In accordance with Government Auditing  Standards,  we have also issued a report
dated  February 27, 2007, on our  consideration  of Flipper  Temple  Associates,
L.P.'s internal control over financial reporting.  The purpose of that report is
to  describe  the  scope of our  testing  of  internal  control  over  financial
reporting  and the results of that  testing and not to provide an opinion on the
internal  control  over  financial  reporting.  In  accordance  with  Government
Auditing  Standards,  we have also issued an opinion dated February 27, 2007, on
Flipper Temple  Associates,  L.P.'s compliance with certain  provisions of laws,
regulations,  contracts, and grant agreements, and other matters that could have
a direct and material effect on a major HUD-assisted program.  Those reports are
an integral part of an audit performed in accordance  with  Government  Auditing
Standards and should be considered in assessing the results of our audit.

Our audit was  conducted  for the  purpose  of  forming  an opinion on the basic
financial statements taken as a whole. The accompanying supplemental information
on pages 24 through 36 is presented for purposes of  additional  analysis and is
not a required part of the basic financial  statements of the partnership.  Such
information has been subjected to the auditing  procedures applied in the audits
of the basic financial  statements and, in our opinion, is fairly stated, in all
material  respects,  in relation to the basic  financial  statements  taken as a
whole.

/s/ Reznick Group, P.C.
Taxpayer Identification Number:
52-1088612
Bethesda, Maryland
February 27, 2007
Lead Auditor:  Nelson D. Gomez

                                       30
<PAGE>

[Letterhead of Heffler, Radetich & Saitta L.L.P]

INDEPENDENT AUDITORS' REPORT

To the Partners of
220 Cooper Street, L.P.

We have audited the accompanying balance sheets of 220 Cooper Street, L.P. as of
December 31, 2006 and 2005, and the related statements of operations,  partners'
equity and cash flows for the years then ended.  These financial  statements are
the  responsibility of the partnership's  management.  Our  responsibility is to
express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing standards
as established by the Auditing Standards Board (United States) and in accordance
with the  standards of the Public  Company  Accounting  Oversight  Board (United
States).  Those  standards  require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  The  Partnership  is not required to have, nor were we engaged to
perform,  an audit of its internal control over financial  reporting.  Our audit
included  consideration of internal control over financial  reporting as a basis
for designing audit  procedures that are appropriate in the  circumstances,  but
not for the  purpose  of  expressing  an  opinion  on the  effectiveness  of the
Partnership's internal control over financial reporting. Accordingly, we express
no such opinion.  An audit also includes  examining,  on a test basis,  evidence
supporting the amounts and  disclosures in the financial  statements,  assessing
the accounting principles used and significant estimates made by management,  as
well as evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the financial position of 220 Cooper Street,  L.P. as of
December 31, 2006 and 2005, and the results of its operations and its cash flows
for the years then ended,  in conformity with  accounting  principles  generally
accepted in the United States of America.

/s/ Heffler, Radetich & Saitta L.L.P.
Mount Laurel, NJ
January 18, 2007

                                       31
<PAGE>

[ARCHAMBO & MUEGGENBORG, PC LETTERHEAD]

INDEPENDENT AUDITOR'S REPORT
----------------------------

To the Partners
Pecan Creek Limited Partnership
Bartlesville, Oklahoma

We  have  audited  the  accompanying  balance  sheets  of  PECAN  CREEK  LIMITED
PARTNERSHIP  as of December  31, 2006 and 2005,  and the related  statements  of
operations,  partners' equity (deficit) and cash flows for the years then ended.
These financial  statements are the responsibility of the Project's  management.
Our responsibility is to express an opinion on these financial  statements based
on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material  misstatement.  The  Partnership  has determined
that it is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting.  Our audit included  consideration of
internal  control  over  financial  reporting  as a basis  for  designing  audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Partnership's internal control
over  financial  reporting.  Accordingly,  we express no such opinion.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements.  An audit also includes  assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation.  We believe that our
audits provide a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects, the financial position of PECAN CREEK LIMITED PARTNERSHIP
as of December 31, 2006 and 2005, and the results of its operations,  changes in
its partners'  equity  (deficit) and its cash flows for the years then ended, in
conformity with accounting principles generally accepted in the United States of
America.

/s/ Archambo & Mueggenborg, PC
Deborah E. Mueggenborg, Engagement Partner
ARCHAMBO & MUEGGENBORG, PC
Certified Public Accountants
302 SE Osage Ave.
Bartsville, OK  74003
73-1439902

February 9, 2007

                                       32
<PAGE>

[Letterhead of AGBIMSON & CO., PLLC]

INDEPENDENT AUDITOR'S REPORT

To the Partners
363 Grand Vendome Associates, Limited Partnership

We have audited the accompanying  balance sheet of 363 Grand Vendome Associates,
Limited  Partnership,  as of December 31, 2006,  and the related  statements  of
operations,  partners'  equity (deficit) and cash flows for the year then ended.
These  financial   statements  are  the   responsibility  of  the  Partnership's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audit.

We conducted  our audit in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material  misstatement.  The  Partnership  has determined
that it is not required to have, nor we were engaged to perform, an audit of its
internal control over financial reporting.  Our audit included  consideration of
internal  control  over  financial  reporting  as a basis  for  designing  audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Partnership's internal control
over  financial  reporting.  Accordingly,  we express no such opinion.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements.  An audit also includes  assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation.  We believe that our
audit provides a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the financial position of 363 Grand Vendome  Associates,
Limited Partnership, as of December 31, 2006, and the results of its operations,
changes  in  partners'  equity  (deficit)  and its cash  flows for the year then
ended, in conformity with accounting principles generally accepted in the United
States of America.

/s/ Agbimson & Co., PLLC
Rockville Centre, New York
January 30, 2007

                                       33
<PAGE>

[Letterhead of DONALD W. CAUSEY & ASSOCIATES, P.C.]

INDEPENDENT AUDITORS' REPORT

To the Partners
New Augusta Associates, Ltd.
New Augusta, Mississippi

We have audited the accompanying balance sheets of New Augusta Associates, Ltd.,
a  limited  partnership,  as of  December  31,  2006 and 2005,  and the  related
statements of  operations,  partners'  capital and cash flows for the years then
ended.  These financial  statements are the  responsibility of the partnership's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.

We conducted  our audits in  accordance  with the auditing  standards  generally
accepted in the United States of America and the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audits to  obtain  reasonable  assurance  about  whether  the
financial  statements are free of material  misstatement.  The  Partnership  has
determined  that it is not required to have, nor were we engaged to perform,  an
audit of its internal  control over  financial  reporting.  Our audits  included
consideration  of  internal  control  over  financial  reporting  as a basis for
designing audit  procedures that are appropriate in the  circumstances,  but not
for  the  purpose  of  expressing  an  opinion  on  the   effectiveness  of  the
Partnership's internal control over financial reporting. Accordingly, we express
no  such  opinion.  An  audit  includes  examining,  on a test  basis,  evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the financial position of New Augusta Associates,  Ltd.,
as of December 31, 2006 and 2005, and the results of its operations,  changes in
partners' capital and its cash flows for the years then ended in conformity with
accounting principles generally accepted in the United States.

Our  audits  were  made for the  purpose  of  forming  an  opinion  on the basic
financial statements taken as a whole. The supplemental  information on pages 10
through  11 is  presented  for  purposes  of  additional  analysis  and is not a
required  part of the basic  financial  statements.  Such  information  has been
subjected  to the  auditing  procedures  applied  in  the  audits  of the  basic
financial  statements  and, in our  opinion,  is fairly  stated in all  material
respects in relation to the basic financial statements taken as a whole.

/s/ Donald W. Causey & Associates, P.C.
Gadsden, Alabama
March 07, 2007

                                       34
<PAGE>

[Letterhead of DONALD W. CAUSEY & ASSOCIATES, P.C.]

INDEPENDENT AUDITORS' REPORT

To the Partners
Pine Shadow, Ltd.
Waveland, Mississippi

We have audited the accompanying  balance sheets of Pine Shadow,  Ltd. a limited
partnership,  as of December 31, 2006 and 2005,  and the related  statements  of
operations,  partners'  deficit and cash flows for the years then  ended.  These
financial statements are the responsibility of the partnership's management. Our
responsibility  is to express an opinion on these financial  statements based on
our audits.

We conducted  our audits in  accordance  with the auditing  standards  generally
accepted in the United States of America and the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audits to  obtain  reasonable  assurance  about  whether  the
financial  statements are free of material  misstatement.  The  Partnership  has
determined  that it is not required to have, nor were we engaged to perform,  an
audit of its internal  control over  financial  reporting.  Our audits  included
consideration  of  internal  control  over  financial  reporting  as a basis for
designing audit  procedures that are appropriate in the  circumstances,  but not
for  the  purpose  of  expressing  an  opinion  on  the   effectiveness  of  the
Partnership's internal control over financial reporting. Accordingly, we express
no  such  opinion.  An  audit  includes  examining,  on a test  basis,  evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all  material  respects,  the  financial  position of Pine Shadow,  Ltd.,  as of
December  31,  2006 and 2005,  and the  results  of its  operations,  changes in
partners'  equity and its cash flows for the years then ended in conformity with
accounting principles generally accepted in the United States of America.

Our  audits  were  made for the  purpose  of  forming  an  opinion  on the basic
financial  statements taken as a whole. The supplemental  information on page 11
is presented for purposes of  additional  analysis and is not a required part of
the basic  financial  statements.  Such  information  has been  subjected to the
auditing procedures applied in the audits of the basic financial statements and,
in our  opinion is fairly  stated in all  material  respects  in relation to the
basic financial statements taken as a whole.

/s/ Donald W. Causey & Associates, P.C.
Gadsden, Alabama
March 8, 2007

                                       35
<PAGE>

[Letterhead of DONALD W. CAUSEY & ASSOCIATES, P.C.]

INDEPENDENT AUDITORS' REPORT

To the Partners
Windsor Place, L.P.
Wedowee, Alabama

We have  audited the  accompanying  balance  sheets of Windsor  Place,  L.P.,  a
limited  partnership,  as of  December  31,  2006  and  2005,  and  the  related
statements of  operations,  partners'  deficit and cash flows for the years then
ended.  These financial  statements are the  responsibility of the partnership's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.

We conducted  our audits in  accordance  with the auditing  standards  generally
accepted in the United States of America and the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audits to  obtain  reasonable  assurance  about  whether  the
financial  statements are free of material  misstatement.  The  Partnership  has
determined  that it is not required to have, nor were we engaged to perform,  an
audit of its internal  control over  financial  reporting.  Our audits  included
consideration  of  internal  control  over  financial  reporting  as a basis for
designing audit  procedures that are appropriate in the  circumstances,  but not
for  the  purpose  of  expressing  an  opinion  on  the   effectiveness  of  the
Partnership's internal control over financial reporting. Accordingly, we express
no  such  opinion.  An  audit  includes  examining,  on a test  basis,  evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the financial  position of Windsor  Place,  L.P., as of
December  31,  2006 and 2005,  and the  results  of its  operations,  changes in
partners' deficit and its cash flows for the years then ended in conformity with
accounting principles generally accepted in the United States of America.

Our  audits  were  made for the  purpose  of  forming  an  opinion  on the basic
financial statements taken as a whole. The supplemental  information on pages 11
through  12 is  presented  for  purposes  of  additional  analysis  and is not a
required  part of the basic  financial  statements.  Such  information  has been
subjected  to the  auditing  procedures  applied  in  the  audits  of the  basic
financial  statements,  and, in our  opinion,  is fairly  stated in all material
respects in relation to the basic financial statements taken as a whole.

/s/ Donald W. Causey & Associates, P.C.
Gadsden, Alabama
March 8, 2007

                                       36
<PAGE>

[Letterhead of DONALD W. CAUSEY & ASSOCIATES, P.C.]

INDEPENDENT AUDITORS' REPORT

To the Partners
Brookwood Associates, Ltd.
Foley, Alabama

We have audited the accompanying balance sheets of Brookwood Associates, Ltd., a
limited  partnership,  as of  December  31,  2006  and  2005,  and  the  related
statements of  operations,  partners'  deficit and cash flows for the years then
ended.  These financial  statements are the  responsibility of the partnership's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.

We conducted  our audits in  accordance  with the auditing  standards  generally
accepted in the United States of America and the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audits to  obtain  reasonable  assurance  about  whether  the
financial  statements are free of material  misstatement.  The  Partnership  has
determined  that it is not required to have, nor were we engaged to perform,  an
audit of its internal  control over  financial  reporting.  Our audits  included
consideration  of  internal  control  over  financial  reporting  as a basis for
designing audit  procedures that are appropriate in the  circumstances,  but not
for  the  purpose  of  expressing  an  opinion  on  the   effectiveness  of  the
Partnership's internal control over financial reporting. Accordingly, we express
no  such  opinion.  An  audit  includes  examining,  on a test  basis,  evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects, the financial position of Brookwood Associates,  Ltd., as
of December  31, 2006 and 2005,  and the results of its  operations,  changes in
partners' deficit and its cash flows for the years then ended in conformity with
accounting principles generally accepted in the United States of America.

Our  audits  were  made for the  purpose  of  forming  an  opinion  on the basic
financial statements taken as a whole. The supplemental  information on pages 10
through  11 is  presented  for  purposes  of  additional  analysis  and is not a
required  part of the basic  financial  statements.  Such  information  has been
subjected  to the  auditing  procedures  applied  in  the  audits  of the  basic
financial  statements,  and, in our  opinion,  is fairly  stated in all material
respects in relation to the basic financial statements taken as a whole.

/s/ Donald W. Causey & Associates, P.C.
Gadsden, Alabama
February 27, 2007

                                       37
<PAGE>

[Letterhead of DONALD W. CAUSEY & ASSOCIATES, P.C.]

INDEPENDENT AUDITORS' REPORT

To the Partners
Heflin Hills Apartments, Ltd.
Heflin, Alabama

We have audited the  accompanying  balance  sheets of Heflin  Hills  Apartments,
Ltd., a limited  partnership,  as of December 31, 2006 and 2005, and the related
statements of  operations,  partners'  deficit and cash flows for the years then
ended.  These financial  statements are the  responsibility of the partnership's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.

We conducted  our audits in  accordance  with the auditing  standards  generally
accepted in the United States of America and the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audits to  obtain  reasonable  assurance  about  whether  the
financial  statements are free of material  misstatement.  The  Partnership  has
determined  that it is not required to have, nor were we engaged to perform,  an
audit of its internal  control over  financial  reporting.  Our audits  included
consideration  of  internal  control  over  financial  reporting  as a basis for
designing audit  procedures that are appropriate in the  circumstances,  but not
for  the  purpose  of  expressing  an  opinion  on  the   effectiveness  of  the
Partnership's internal control over financial reporting. Accordingly, we express
no  such  opinion.  An  audit  includes  examining,  on a test  basis,  evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects, the financial position of Heflin Hills Apartments,  Ltd.,
as of December 31, 2006 and 2005, and the results of its operations,  changes in
partners' deficit and its cash flows for the years then ended in conformity with
accounting principles generally accepted in the United States of America.

Our  audits  were  made for the  purpose  of  forming  an  opinion  on the basic
financial statements taken as a whole. The supplemental  information on pages 10
through  11 is  presented  for  purposes  of  additional  analysis  and is not a
required  part of the basic  financial  statements.  Such  information  has been
subjected  to the  auditing  procedures  applied  in  the  audits  of the  basic
financial  statements,  and, in our  opinion,  is fairly  stated in all material
respects in relation to the basic financial statements taken as a whole.

/s/ Donald W. Causey & Associates, P.C.
Gadsden, Alabama
March 8, 2007

                                       38
<PAGE>

[Letterhead of DONALD W. CAUSEY & ASSOCIATES, P.C.]

INDEPENDENT AUDITORS' REPORT

To the Partners
Shadowood Apartments, Ltd.
Stevenson, Alabama

We have audited the accompanying balance sheets of Shadowood Apartments, Ltd., a
limited  partnership,  as of  December  31,  2006  and  2005,  and  the  related
statements of  operations,  partners'  deficit and cash flows for the years then
ended.  These financial  statements are the  responsibility of the partnership's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.

We conducted  our audits in  accordance  with the auditing  standards  generally
accepted in the United States of America and the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audits to  obtain  reasonable  assurance  about  whether  the
financial  statements are free of material  misstatement.  The  Partnership  has
determined  that it is not required to have, nor were we engaged to perform,  an
audit of its  internal  control over  financial  reporting.  Our audit  included
consideration  of  internal  control  over  financial  reporting  as a basis for
designing audit  procedures that are appropriate in the  circumstances,  but not
for  the  purpose  of  expressing  an  opinion  on  the   effectiveness  of  the
Partnership's internal control over financial reporting. Accordingly, we express
no  such  opinion.  An  audit  includes  examining,  on a test  basis,  evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects, the financial position of Shadowood Apartments,  Ltd., as
of December  31, 2006 and 2005,  and the results of its  operations,  changes in
partners' deficit and its cash flows for the years then ended in conformity with
accounting principles generally accepted in the United States of America.

Our  audits  were  made for the  purpose  of  forming  an  opinion  on the basic
financial statements taken as a whole. The supplemental  information on pages 10
through  11 is  presented  for  purposes  of  additional  analysis  and is not a
required  part of the basic  financial  statements.  Such  information  has been
subjected  to the  auditing  procedures  applied  in  the  audits  of the  basic
financial  statements,  and, in our  opinion,  is fairly  stated in all material
respects in relation to the basic financial statements taken as a whole.

/s/ Donald W. Causey & Associates, P.C.
Gadsden, Alabama
February 28, 2007

                                       39
<PAGE>

[Letterhead of DONALD W. CAUSEY & ASSOCIATES, P.C.]

INDEPENDENT AUDITORS' REPORT

To the Partners
Brittany Associates, L.P.
Dekalb, Mississippi.

We have audited the accompanying balance sheets of Brittany Associates,  L.P., a
limited  partnership,  as of  December  31,  2006  and  2005,  and  the  related
statements of  operations,  partners'  capital and cash flows for the years then
ended.  These financial  statements are the  responsibility of the partnership's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.

We conducted  our audits in  accordance  with the auditing  standards  generally
accepted in the United States of America and the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audits to  obtain  reasonable  assurance  about  whether  the
financial  statements are free of material  misstatement.  The  Partnership  has
determined  that it is not required to have, nor were we engaged to perform,  an
audit of its  internal  control over  financial  reporting.  Our audit  included
consideration  of  internal  control  over  financial  reporting  as a basis for
designing audit  procedures that are appropriate in the  circumstances,  but not
for  the  purpose  of  expressing  an  opinion  on  the   effectiveness  of  the
Partnership's internal control over financial reporting. Accordingly, we express
no  such  opinion.  An  audit  includes  examining,  on a test  basis,  evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the financial position of Brittany Associates,  L.P., as
of December  31, 2006 and 2005,  and the results of its  operations,  changes in
partners' capital and its cash flows for the years then ended in conformity with
accounting principles generally accepted in the United States of America.

Our  audits  were  made for the  purpose  of  forming  an  opinion  on the basic
financial statements taken as a whole. The supplemental  information on pages 10
through  11 is  presented  for  purposes  of  additional  analysis  and is not a
required  part of the basic  financial  statements.  Such  information  has been
subjected  to the  auditing  procedures  applied  in  the  audits  of the  basic
financial  statements,  and, in our  opinion,  is fairly  stated in all material
respects in relation to the basic financial statements taken as a whole.

/s/ Donald W. Causey & Associates, P.C.
Gadsden, Alabama
February 27, 2007

                                       40
<PAGE>

[Letterhead of DONALD W. CAUSEY & ASSOCIATES, P.C.]

INDEPENDENT AUDITORS' REPORT

To the Partners
Hidden Valley Apartments, Ltd.
Brewton, Alabama

We have audited the  accompanying  balance  sheets of Hidden Valley  Apartments,
Ltd., a limited  partnership,  as of December 31, 2006 and 2005, and the related
statements of  operations,  partners'  capital and cash flows for the years then
ended.  These financial  statements are the  responsibility of the partnership's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.

We conducted  our audits in  accordance  with the auditing  standards  generally
accepted in the United States of America and the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audits to  obtain  reasonable  assurance  about  whether  the
financial  statements are free of material  misstatement.  The  Partnership  has
determined  that it is not required to have, nor were we engaged to perform,  an
audit of its  internal  control over  financial  reporting.  Our audit  included
consideration  of  internal  control  over  financial  reporting  as a basis for
designing audit  procedures that are appropriate in the  circumstances,  but not
for  the  purpose  of  expressing  an  opinion  on  the   effectiveness  of  the
Partnership's internal control over financial reporting. Accordingly, we express
no  such  opinion.  An  audit  includes  examining,  on a test  basis,  evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects, the financial position of Hidden Valley Apartments, Ltd.,
as of December 31, 2006 and 2005, and the results of its operations,  changes in
partners' capital and its cash flows for the years then ended in conformity with
accounting principles generally accepted in the United States of America.

Our  audits  were  made for the  purpose  of  forming  an  opinion  on the basic
financial statements taken as a whole. The supplemental  information on pages 10
through  11 is  presented  for  purposes  of  additional  analysis  and is not a
required  part of the basic  financial  statements.  Such  information  has been
subjected  to the  auditing  procedures  applied  in  the  audits  of the  basic
financial  statements,  and, in our  opinion,  is fairly  stated in all material
respects in relation to the basic financial statements taken as a whole.

/s/ Donald W. Causey & Associates, P.C.
Gadsden, Alabama
February 27, 2007

                                       41
<PAGE>

[Letterhead of DONALD W. CAUSEY, CPA, P.C.]

INDEPENDENT AUDITOR'S REPORT

To the Partners
Warsaw Elderly Housing, Ltd.
Warsaw, Kentucky

We have audited the accompanying balance sheets of Warsaw Elderly Housing, Ltd.,
a  limited  partnership,  as of  December  31,  2006 and 2005,  and the  related
statements of  operations,  partners'  capital and cash flows for the years then
ended.  These financial  statements are the  responsibility of the partnership's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.

We conducted  our audits in  accordance  with the auditing  standards  generally
accepted in the United States of America and the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audits to  obtain  reasonable  assurance  about  whether  the
financial  statements are free of material  misstatement.  The  Partnership  has
determined  that it is not required to have, nor were we engaged to perform,  an
audit of its internal  control over  financial  reporting.  Our audits  included
consideration  of  internal  control  over  financial  reporting  as a basis for
designing audit  procedures that are appropriate in the  circumstances,  but not
for  the  purpose  of  expressing  an  opinion  on  the   effectiveness  of  the
Partnership's internal control over financial reporting. Accordingly, we express
no  such  opinion.  An  audit  includes  examining,  on a test  basis,  evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the financial position of Warsaw Elderly Housing,  Ltd.,
as of December 31, 2006 and 2005, and the results of its operations,  changes in
partners' capital and its cash flows for the years then ended in conformity with
accounting principles generally accepted in the United States of America.

Our  audits  were  made for the  purpose  of  forming  an  opinion  on the basic
financial statements taken as a whole. The supplemental  information on pages 10
through  11 is  presented  for  purposes  of  additional  analysis  and is not a
required  part of the basic  financial  statements.  Such  information  has been
subjected  to the  auditing  procedures  applied  in  the  audits  of the  basic
financial  statements,  and, in our  opinion,  is fairly  stated in all material
respects in relation to the basic financial statements taken as a whole.

/s/ Donald W. Causey & Associates, P.C.
Gadsden, Alabama
February 25, 2006

                                       42
<PAGE>

[Letterhead of DONALD W. CAUSEY & ASSOCIATES, P.C.]

INDEPENDENT AUDITORS' REPORT

To the Partners
West Hill Square, Ltd.
Gordo, Alabama

We have audited the  accompanying  balance  sheets of West Hill Square,  Ltd., a
limited  partnership,  as of  December  31,  2006  and  2005,  and  the  related
statements of  operations,  partners'  capital and cash flows for the years then
ended.  These financial  statements are the  responsibility of the partnership's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.

We conducted  our audits in  accordance  with the auditing  standards  generally
accepted in the United States of America and the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audits to  obtain  reasonable  assurance  about  whether  the
financial  statements are free of material  misstatement.  The  Partnership  has
determined  that it is not required to have, nor were we engaged to perform,  an
audit of its internal  control over  financial  reporting.  Our audits  included
consideration  of  internal  control  over  financial  reporting  as a basis for
designing audit  procedures that are appropriate in the  circumstances,  but not
for  the  purpose  of  expressing  an  opinion  on  the   effectiveness  of  the
Partnership's internal control over financial reporting. Accordingly, we express
no  such  opinion.  An  audit  includes  examining,  on a test  basis,  evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the financial position of West Hill Square,  Ltd., as of
December  31,  2006 and 2005,  and the  results  of its  operations,  changes in
partners' capital and its cash flows for the years then ended in conformity with
accounting principles generally accepted in the United States of America.

Our  audits  were  made for the  purpose  of  forming  an  opinion  on the basic
financial statements taken as a whole. The supplemental  information on pages 10
through  11 is  presented  for  purposes  of  additional  analysis  and is not a
required  part of the basic  financial  statements.  Such  information  has been
subjected  to the  auditing  procedures  applied  in  the  audits  of the  basic
financial  statements,  and, in our  opinion,  is fairly  stated in all material
respects in relation to the basic financial statements taken as a whole.

/s/ Donald W. Causey & Associates, P.C.
Gadsden, Alabama
February 7, 2007

                                       43
<PAGE>

[Letterhead of DONALD W. CAUSEY & ASSOCIATES, P.C.]

INDEPENDENT AUDITORS' REPORT

To the Partners
Elmwood Associates, L.P.
Picayune, Mississippi

We have audited the accompanying  balance sheets of Elmwood Associates,  L.P., a
limited  partnership,  as of  December  31,  2006  and  2005,  and  the  related
statements of  operations,  partners'  capital and cash flows for the years then
ended.  These financial  statements are the  responsibility of the partnership's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audits.

We conducted  our audits in  accordance  with the auditing  standards  generally
accepted in the United States of America and the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audits to  obtain  reasonable  assurance  about  whether  the
financial  statements are free of material  misstatement.  The  Partnership  has
determined  that it is not required to have, nor were we engaged to perform,  an
audit of its  internal  control over  financial  reporting.  Our audit  included
consideration  of  internal  control  over  financial  reporting  as a basis for
designing audit  procedures that are appropriate in the  circumstances,  but not
for  the  purpose  of  expressing  an  opinion  on  the   effectiveness  of  the
Partnership's internal control over financial reporting. Accordingly, we express
no  such  opinion.  An  audit  includes  examining,  on a test  basis,  evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects, the financial position of Elmwood Associates, L.P., as of
December  31,  2006 and 2005,  and the  results  of its  operations,  changes in
partners' capital and its cash flows for the years then ended in conformity with
accounting principles generally accepted in the United States of America.

Our  audits  were  made for the  purpose  of  forming  an  opinion  on the basic
financial statements taken as a whole. The supplemental  information on pages 10
through  11 is  presented  for  purposes  of  additional  analysis  and is not a
required  part of the basic  financial  statements.  Such  information  has been
subjected  to the  auditing  procedures  applied  in  the  audits  of the  basic
financial  statements,  and, in our  opinion,  is fairly  stated in all material
respects in relation to the basic financial statements taken as a whole.

/s/ Donald W. Causey & Associates, P.C.
Gadsden, Alabama
February 26, 2007

                                       44
<PAGE>

[Letterhead of Holthouse Carlin & VanTrigt LLP]

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To the Partners
Harmony Associates, L.P.

We have audited the accompanying balance sheet of Harmony Associates, L.P. as of
December 31, 2006,  and the related  statements of income,  changes in partners'
capital  (deficit)  and cash  flows for the year  then  ended.  These  financial
statements  are  the  responsibility  of  the  partnership's   management.   Our
responsibility  is to express an opinion on these financial  statements based on
our audit.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material  misstatement.  The  Partnership  has determined
that it is not required to have, nor we were engaged to perform, an audit of its
internal control over financial reporting.  Our audit included  consideration of
internal  control  over  financial  reporting  as a basis  for  designing  audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Partnership's internal control
over  financial  reporting.  Accordingly,  we express no such opinion.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements.  An audit also includes  assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation.  We believe that our
audit provides a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects, the financial position of Harmony Associates, L.P., as of
December 31, 2006,  and the results of its operations and its cash flows for the
years then ended, in conformity with accounting principles generally accepted in
the United States of America.

Our audit was  conducted  for the  purpose  of  forming  an opinion on the basic
financial  statements  taken  as  a  whole.  The  information  included  in  the
accompanying  Schedule I is presented for purposes of additional analysis and is
not a required part of the basic financial statements. Such information has been
subjected to the auditing procedures applied in the audit of the basic financial
statements  and, in our opinion,  is fairly  stated in all material  respects in
relation to the basic financial statements taken as a whole.

/s/ Holthouse Carlin & VanTrigt LLP
Santa Monica, California
February 23, 2007

                                       45
<PAGE>

[Letterhead of Matthews, Cutrer & Lindsay, P.A.]

To the Partners of
Westbrook Square, LP

INDEPENDENT AUDITOR'S REPORT

We have  audited the  accompanying  balance  sheets of Westbrook  Square,  LP (a
Mississippi  limited  partnership),  RHS  Project  No.  28-040-640770978  as  of
December 31, 2006 and 2005, and the related statements of operations,  partners'
capital  (deficit)  and cash flows for the years  then  ended.  These  financial
statements  are  the  responsibility  of  the  partnership's   management.   Our
responsibility  is to express an opinion on these financial  statements based on
our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material  misstatement.  The  Partnership  has determined
that it is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting.  Our audit included  consideration of
internal  control  over  financial  reporting  as a basis  for  designing  audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Partnership's internal control
over  financial  reporting.  Accordingly,  we express no such opinion.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements.  An audit also includes  assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation.  We believe that our
audits provide a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the financial  position of Westbrook  Square,  LP as of
December 31, 2006 and 2005, and the results of its operations and its cash flows
for the years then ended in  conformity  with  accounting  principles  generally
accepted in the United States of America.

Our audit was made for the  purpose  of  forming  an  opinion  on the  financial
statements  taken as a  whole.  The  accompanying  supplemental  information  is
presented for the purposes of additional  analysis and is not a required part of
the basic financial statements. Such information has been subjected to the audit
procedures applied in the audit of the basic financial  statements,  and, in our
opinion,  is fairly  stated in all  material  respects  in relation to the basic
financial statements taken as a whole.


/s/ Matthews, Cutrer & Lindsay, P.A.
Ridgeland, Mississippi
February 9, 2007

                                       46
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                           CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                                                           March 31,
                                                                                  ----------------------------
                                                                                      2007            2006
                                                                                  ------------    ------------
<S>                                                                               <C>             <C>
ASSETS

Operating assets:
 Property and equipment, at cost, less accumulated depreciation (Note 4)          $ 24,877,432    $ 36,462,734
 Cash and cash equivalents                                                           5,899,857       3,404,395
 Cash held in escrow                                                                 2,869,341       3,734,746
 Deferred costs - net of accumulated amortization (Note 5)                             243,958         259,582
 Other assets                                                                          852,070         851,970
                                                                                  ------------    ------------

Total operating assets                                                              34,742,658      44,713,427
                                                                                  ------------    ------------

Assets held for sale (Note 11):
 Property and equipment held for sale, net of accumulated depreciation (Note 4)              0      31,269,354
 Other assets held for sale                                                              1,704       3,531,615
                                                                                  ------------    ------------
Total assets held for sale                                                               1,704      34,800,969
                                                                                  ------------    ------------

Total assets                                                                      $ 34,744,362    $ 79,514,396
                                                                                  ============    ============

LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)

Operating liabilities:
 Mortgage notes payable (Note 6)                                                  $ 25,276,141    $ 33,397,400
 Accounts payable and other liabilities                                              1,350,713       5,291,827
 Due to local general partners and affiliates (Note 7)                               1,078,112       1,181,186
 Due to general partners and affiliates                                              3,229,196       9,666,054
                                                                                  ------------    ------------

Total operating liabilities                                                         30,934,162      49,536,467
                                                                                  ------------    ------------

Liabilities related to assets held for sale (Note 11):
 Mortgage notes payable of assets held for sale (Note 6)                                     0      26,468,361
 Other liabilities held for sale including minority interest                             7,113       6,455,851
                                                                                  ------------    ------------
Total liabilities related to assets held for sale                                        7,113      32,924,212
                                                                                  ------------    ------------

Total liabilities                                                                   30,941,275      82,460,679
                                                                                  ------------    ------------

Minority interests (Note 2)                                                            672,373       2,968,663
                                                                                  ------------    ------------

Commitments and contingencies (Notes 7 and 10)

Partners' capital (deficit):
 Limited partners (72,896 BACs issued and outstanding)(Note 1)                        (386,432)     (5,175,151)
 General partners                                                                    3,517,146        (739,795)
                                                                                  ------------    ------------

Total partners' capital (deficit)                                                    3,130,714      (5,914,946)
                                                                                  ------------    ------------

Total liabilities and partners' capital (deficit)                                 $ 34,744,362    $ 79,514,396
                                                                                  ============    ============
</TABLE>

          See accompanying notes to consolidated financial statements.

                                       47
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                      CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
                                                                        Years ended March 31,
                                                             --------------------------------------------
                                                                 2007            2006*           2005*
                                                             ------------    ------------    ------------
<S>                                                          <C>             <C>             <C>
Operations:

Revenues
Rental income                                                $  5,236,178    $  5,322,456    $  5,296,322
Other (Note 2)                                                  1,290,590       1,111,444         945,653
                                                             ------------    ------------    ------------

Total revenues                                                  6,526,768       6,433,900       6,241,975
                                                             ------------    ------------    ------------

Expenses:

Repairs and maintenance                                         1,129,054       1,405,055       1,255,202
Operating and other                                             1,000,730         999,872         853,319
Real estate taxes                                                 341,052         337,324         334,509
Interest                                                        1,587,518       1,558,064       1,578,962
Depreciation and amortization (Notes 4 and 5)                   1,547,165       1,557,875       1,534,118
General and administrative                                      1,527,184       1,198,046       1,032,373
General and administrative-related parties (Note 7)             1,058,994       1,467,163       1,346,854
                                                             ------------    ------------    ------------

Total expenses                                                  8,191,697       8,523,399       7,935,337
                                                             ------------    ------------    ------------

Loss from continuing operations before minority interest       (1,664,929)     (2,089,499)     (1,693,362)

Minority interest in loss of subsidiaries from operations          12,796          13,180           7,176
                                                             ------------    ------------    ------------

Loss from continuing operations                                (1,652,133)     (2,076,319)     (1,686,186)

Discontinued operations:

Income (loss) from discontinued operations (including gain
   (loss) and minority interest) (Note 11)                     13,484,294      (1,715,725)     (2,533,452)
                                                             ------------    ------------    ------------

Net income (loss)                                            $ 11,832,161    $ (3,792,044)   $ (4,219,638)
                                                             ============    ============    ============

Loss from operations - limited partners                      $ (1,635,612)   $ (2,055,556)   $ (1,669,324)
Income (loss) from discontinued operations (including gain
   (loss) and minority interest) - limited partners            13,349,451      (1,698,568)     (2,508,118)
                                                             ------------    ------------    ------------

Net income (loss) - limited partners                         $ 11,713,839    $ (3,754,124)   $ (4,177,442)
                                                             ============    ============    ============

Number of BACs outstanding                                         72,896          72,896          72,896
                                                             ============    ============    ============

Loss from operations per BAC                                 $     (22.43)   $     (28.20)   $     (22.90)
Income (loss) from discontinued operations per BAC                 183.13          (23.30)         (34.41)
                                                             ------------    ------------    ------------

Net income (loss) per BAC                                    $     160.70    $     (51.50)   $     (57.31)
                                                             ============    ============    ============
</TABLE>
* Reclassified for comparative purposes.


          See accompanying notes to consolidated financial statements.

                                       48
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
        CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
                    YEARS ENDED MARCH 31, 2007, 2006 and 2005
<TABLE>
<CAPTION>
                                                                  Limited         General
                                                   Total         Partners        Partners
                                               ------------    ------------    ------------
<S>                                            <C>             <C>             <C>
Partners' capital (deficit) - April 1, 2004    $  2,096,736    $  2,756,415    $   (659,679)

Net loss                                         (4,219,638)     (4,177,442)        (42,196)
                                               ------------    ------------    ------------

Partners' deficit - March 31, 2005               (2,122,902)     (1,421,027)       (701,875)

Net loss                                         (3,792,044)     (3,754,124)        (37,920)
                                               ------------    ------------    ------------

Partner's deficit - March 31, 2006               (5,914,946)     (5,175,151)       (739,795)

Net income                                       11,832,161      11,713,839         118,322

Contribution - write-off of partnership
  management fees related to sold
  properties (Note 7)                             4,095,540               0       4,095,540

Contribution - write-off of related
  party debt                                        113,030               0         113,030

Distributions                                    (6,995,071)     (6,925,120)        (69,951)
                                               ------------    ------------    ------------

Partners' capital (deficit) - March 31, 2007   $  3,130,714    $   (386,432)   $  3,517,146
                                               ============    ============    ============
</TABLE>


          See accompanying notes to consolidated financial statements.

                                       49
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                    YEARS ENDED MARCH 31, 2007, 2006 and 2005
<TABLE>
<CAPTION>
                                                                        2007             2006            2005
                                                                    ------------    ------------    ------------
<S>                                                                 <C>             <C>             <C>
Cash flows from operating activities:
Net income (loss)                                                   $ 11,832,161    $ (3,792,044)   $ (4,219,638)

Adjustments to reconcile net income (loss) to net cash (used in)
  provided by operating activities:

  (Gain) loss on sale of investments                                 (10,090,931)         81,351               0
  Capital contributions - General Partner                              4,208,570               0               0
  Loss on impairment of property and equipment                         1,505,824         555,000               0
  Depreciation and amortization                                        2,567,306       4,902,705       5,074,408
  Minority interest in loss of subsidiaries                           (5,905,310)     (1,580,663)        (43,525)
  (Increase) decrease in other assets                                    (43,810)         31,691         (81,783)
  Increase in deferred revenue from sale of properties                         0       1,888,040               0
  (Decrease) increase in accounts payable and other liabilities       (2,432,564)        344,774         683,812
  Decrease (increase) in cash held in escrow                             322,704         (38,852)       (806,472)
  (Decrease) increase in due to general partners and affiliates       (6,632,207)      1,122,812         991,218
  Increase in due to local general partners and affiliates               851,543          69,352         119,303
  Decrease in due to local general partners and affiliates              (150,579)       (235,137)        (91,390)
                                                                    ------------    ------------    ------------

Net cash (used in) provided by operating activities                   (3,967,293)      3,349,029       1,625,933
                                                                    ------------    ------------    ------------

Cash flows from investing activities:

  Additions to property and equipment                                   (949,279)       (627,560)       (567,870)
  Proceeds from sale of investments                                   39,496,685       2,378,602               0
  Cost paid relating to sale of properties                            (1,788,468)              0               0
  Decrease in due to local general partners and affiliates                     0               0        (662,425)
                                                                    ------------    ------------    ------------

Net cash provided by (used in) investing activities                   36,758,938       1,751,042      (1,230,295)
                                                                    ------------    ------------    ------------

Cash flows from financing activities:
  Decrease in deferred costs                                                   0               0           5,079
  Repayments of mortgage loans                                       (22,871,898)       (904,942)     (1,165,811)
  Increase in due to local general partners and affiliates                53,875         405,955         418,782
  Decrease in due to local general partners and affiliates              (575,717)     (1,940,801)        (78,237)
  (Decrease) increase in capitalization of consolidated
   subsidiaries attributable to minority interest                     (1,173,539)       (138,467)         82,363
  Distributions                                                       (6,995,071)              0               0
                                                                    ------------    ------------    ------------

Net cash used in financing activities                                (31,562,350)     (2,578,255)       (737,824)
                                                                    ------------    ------------    ------------

Net increase (decrease) in cash and cash equivalents                   1,229,295       2,521,816        (342,186)

Cash and cash equivalents at beginning of year                         4,672,266       2,150,450       2,492,636
                                                                    ------------    ------------    ------------

Cash and cash equivalents at end of year*                           $  5,901,561    $  4,672,266    $  2,150,450
                                                                    ============    ============    ============

Supplemental disclosure of cash flow information:
Cash paid during the year for interest                              $  2,762,307    $  2,701,196    $  2,879,716
                                                                    ============    ============    ============

*  Cash and cash  equivalents,  end of year,  includes cash and cash equivalents
   from discontinued operations of $1,704, $1,267,871 and $0, respectively.


Summarized below are the components of the gain (loss)
  on sale of investments:

  Proceeds from sale of investments - net                           $(37,708,217)   $ (2,378,602)   $          0
  Decrease in property and equipment, net of accumulated
    depreciation                                                      39,841,367       3,833,788               0
  Decrease in cash held in escrow                                      1,762,291         634,479               0
  Decrease (increase) in other assets                                    799,045        (309,513)              0
  Decrease in mortgage notes payable                                 (11,717,722)     (4,348,645)              0
  (Decrease) increase in accounts payable and other liabilities       (2,841,170)      1,943,361               0
  Decrease in due to general partners and affiliates                     (74,651)        (39,850)              0
  Decrease in due to local general partners and affiliate               (938,739)        (90,228)              0
  Decrease in deferred costs                                             193,881               0               0
  Increase in capitalization of consolidated subsidiaries
    attributable to minority interest                                    592,984         836,561               0
</TABLE>

          See accompanying notes to consolidated financial statements.

                                       50
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          MARCH 31, 2007, 2006 and 2005


NOTE 1 - General

Freedom   Tax  Credit   Plus  L.P.,   a  Delaware   limited   partnership   (the
"Partnership"),  was  organized  on August  28,  1989 and  commenced  its public
offering  on  February 9, 1990 (the  "Offering").  The  general  partners of the
Partnership are Related Freedom Associates L.P. (the "Related General Partner"),
a Delaware limited partnership, and its affiliate, Freedom GP Inc. (the "Freedom
General Partner"), a Delaware corporation (and together with the Related General
Partner, the "General  Partners").  The ultimate partner of the General Partners
is Centerline Holding Company ("Centerline") (which had been known as CharterMac
until April 2007). The Partnership  will terminate on December 31, 2030,  unless
terminated sooner under the provisions of the limited  partnership  agreement of
the Partnership (the "Partnership Agreement").

On March 15, 2007,  Centerline  announced  the  retirement  of Alan P. Hirmes as
Chief Financial  Officer of Centerline.  Upon his  retirement,  he also resigned
from his  position as Director,  President,  Chief  Executive  Officer and Chief
Financial  Officer  of the  general  partner  of the  Related  General  Partner.
Centerline  has named  Robert L. Levy as Chief  Financial  Officer and Andrew J.
Weil as Chief Executive Officer to replace Mr. Hirmes.

The  Partnership's   business  is  to  invest  in  other  partnerships   ("Local
Partnerships,"  "subsidiaries"  or "subsidiary  partnerships")  owning leveraged
apartment  complexes  that are  eligible for the  low-income  housing tax credit
("Tax  Credit")  enacted in the Tax Reform Act of 1986 and to entitle  qualified
BACs holders to Tax Credits over the period of the Partnership's  entitlement to
claim Tax  Credits  (for each  property,  generally  ten years  from the date of
investment or, if later,  the date the property is leased to qualified  tenants;
referred to herein as the "Credit  Period").  Each of the Local  Partnerships in
which the  Partnership  has an interest has been allocated by the relevant state
credit agency the authority to recognize Tax Credits  during the Credit  Period,
provided  that the Local  Partnership  satisfies the rent  restriction,  minimum
set-aside and other requirements for recognition of the Tax Credits at all times
during the 15-year compliance period (the "Compliance Period").

As of December 31, 2002, the Credit  Periods for all of the apartment  complexes
have expired,  although each Local  Partnership must continue to comply with the
Tax Credit requirements until the end of the Compliance Period in order to avoid
recapture of the Tax Credits.  The  Compliance  Periods  will  continue  through
December 31, 2007 with respect to the Properties  depending upon when the Credit
Period commenced.

The Partnership was authorized to issue a total of 200,000 Beneficial Assignment
Certificates  ("BACs"),  which  had  been  registered  with the  Securities  and
Exchange  Commission  for sale to the public.  As of August 8, 1991 (the date on
which the  Partnership  held the final  closing of the sale of BACs and on which
the Offering was terminated),  the Partnership had received $72,896,000 of gross
proceeds of the Offering from 4,780 investors.

The terms of the Partnership  Agreement  provide,  among other things,  that net
profits or losses and distributions of cash flow are, in general,  allocated 99%
to the limited partners and BACs holders and 1% to the General Partners.


NOTE 2 - Summary of Significant Accounting Policies

a)  Basis of Accounting and Presentation

The  Partnership's  fiscal year ends on March 31. All subsidiaries have calendar
year ends.  Accounts of the  subsidiaries  have been  adjusted for  intercompany
transactions from January 1 through March 31. The Partnership's fiscal year ends
March  31 in  order  to allow  adequate  time  for the  subsidiaries'  financial
statements  to be  prepared  and  consolidated.  The  books and  records  of the
Partnership are maintained on the accrual basis of accounting in accordance with
accounting principles generally accepted in the United States.

b)  Basis of Consolidation

The consolidated  financial  statements  include the accounts of the Partnership
and its subsidiary partnerships,  in which the Partnership is a limited partner,
with  an  ownership   interest  ranging  from  approximately  98%  to  99%.  All
intercompany  accounts and transactions  with the subsidiary  partnerships  have
been eliminated in consolidation.  Through the rights of the Partnership  and/or
an  affiliate  of  the  General  Partners,  which  affiliate  has a  contractual
obligation to act on behalf of the Partnership, to remove the general partner of
the subsidiary partnerships and to approve certain major operating and financial
decisions,   the  Partnership  has  a  controlling  financial  interest  in  the
subsidiary partnerships.

Increases  (decreases)  in  the  capitalization  of  consolidated   subsidiaries
attributable  to  minority  interest  arise  from  cash  contributions  and cash
distributions to the minority interest partners.

The  Partnership's  investment  in each  subsidiary  is equal to the  respective
subsidiary's partners' equity less minority interest capital, if any.

c)  Cash and Cash Equivalents

For  purposes  of the  consolidated  statements  of cash  flows,  cash  and cash
equivalents  include cash on hand, cash in banks,  and investments in short-term
money market  accounts  (which were purchased with original  maturities of three
months or less).

d)  Cash Held in Escrow

Cash held in escrow includes replacement reserves and tenant security deposits.

                                       51
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          MARCH 31, 2007, 2006 and 2005


e)  Property and Equipment

Property and  equipment  to be held and used are carried at cost which  includes
the purchase price, acquisition fees and expenses,  construction period interest
and any other costs incurred in acquiring the  properties.  The cost of property
and equipment is depreciated over their estimated useful lives using accelerated
and straight-line methods.  Expenditures for repairs and maintenance are charged
to expense as incurred;  major renewals and betterments are capitalized.  At the
time property and  equipment are retired or otherwise  disposed of, the cost and
accumulated   depreciation  are  eliminated  from  the  assets  and  accumulated
depreciation accounts and the profit or loss on such disposition is reflected in
earnings.  The  Partnership  complies  with  Statement of  Financial  Accounting
Standards  No. 144  "Accounting  for the  Impairment  or Disposal of  Long-Lived
Assets"  ("SFAS No.  144").  A loss on  impairment  of assets is  recorded  when
management  estimates amounts  recoverable through future operations and sale of
the property on an undiscounted  basis are below  depreciated cost. At that time
property  investments  themselves are reduced to estimated fair value (generally
using  estimated  future  discounted  net  cash  flows)  when  the  property  is
considered to be impaired and the depreciated cost exceeds estimated fair value.

Through March 31, 2007, the Partnership has recorded approximately $5,726,000 as
a loss on impairment of assets or reductions to estimated fair value.

In  accordance  with SFAS No. 144, the results of  discontinued  operations  are
reported as a separate  component of income  before  extraordinary  items on the
consolidated  statements  of  operations.  Discontinued  operations  include the
results of operations and any gain or loss recognized for Local Partnership that
have been  disposed of or are held for sale.  A gain or loss  recognized  on the
disposal is disclosed  in the notes to the  consolidated  financial  statements.
Adjustments  to amounts  previously  reported in  operations  that are  directly
related to the disposal of a Local  Partnership are  reclassified in the current
period  as  discontinued  operations  for  comparability  purposes.  Assets  and
liabilities  of a Local  Partnership  that are  classified  as held for sale are
presented separately in the asset and liability sections,  respectively,  of the
consolidated balance sheets.

At the time management  commits to a plan to dispose of assets,  said assets are
adjusted to the lower of carrying  amount or fair value less costs to sell. Such
assets would be classified as property and  equipment-held  for sale and are not
depreciated.  There were no assets classified as property and equipment-held for
sale at March 31, 2007.

f)  Revenue Recognition

Rental  income is earned  under  standard  residential  operating  leases and is
typically  due the first day of each month,  but can vary by property due to the
terms of the tenant leases.  Rental income is recognized when earned and charged
to tenants' accounts receivable if not received by the due date. Rental payments
received in advance of the due date are deferred until earned.

Rental subsidies are recognized as rental income during the month in which it is
earned. The Partnership  received rental subsidies which amounted to $2,976,343,
$3,430,948  and  $3,488,027  for the years ended March 31, 2007,  2006 and 2005,
respectively.  The related rental subsidy  programs have  expiration  dates that
terminate upon total disbursement of the assistance obligation.

Other  revenues are  recorded  when earned and consist of the  following  items:
Interest  income  earned on cash and cash  equivalent  balances and cash held in
escrow balances,  income from forfeited security deposits, late charges, laundry
and vending income and other rental related items.

Other  revenues  from  operations  include  the  following  amounts  at both the
Partnership and Local Partnership level:
<TABLE>
<CAPTION>
                                 Years Ended March 31,
                         ------------------------------------
                             2007        2006*        2005*
                         ----------   ----------   ----------
<S>                      <C>          <C>          <C>
Interest                 $  373,757   $   51,045   $   19,832
Other                       916,833    1,060,399      925,821
                         ----------   ----------   ----------

   Total other revenue   $1,290,590   $1,111,444   $  945,653
                         ==========   ==========   ==========
</TABLE>

Other revenues from  discontinued  operations  include the following  amounts at
both the Partnership and Local Partnership level:
<TABLE>
<CAPTION>
                                 Years Ended March 31,
                         ------------------------------------
                             2007        2006*        2005*
                         ----------   ----------   ----------
<S>                      <C>          <C>          <C>
Interest                 $   38,940   $   54,056   $  127,023
Other                       274,656      558,339      475,248
                         ----------   ----------   ----------

  Total other revenue    $  313,596   $  612,395   $  602,271
                         ==========   ==========   ==========
</TABLE>

* Reclassified for comparative purposes


                                       52
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          MARCH 31, 2007, 2006 and 2005


g)  Income Taxes

The  Partnership  is not  required to provide  for, or pay,  any federal  income
taxes.  Net income or loss generated by the Partnership is passed through to the
partners and is required to be reported by them. The  Partnership may be subject
to state and local taxes in jurisdictions  in which it operates.  For income tax
purposes, the Partnership has a fiscal year ending December 31 (see Note 8).

In prior years,  the  Partnership  relied on the 5% safe harbor  established  by
Internal Revenue Service ("IRS")  regulations to avoid being  characterized as a
"publicly-traded  partnership"  that  is  taxed  as a  corporation.  The 5% safe
harbor,  however,  expired and is no longer  available  as of December 31, 2005.
Accordingly,  the  Partnership  now relies on a 2% safe  harbor  established  by
another  IRS  regulation  to avoid  being  characterized  as a  "publicly-traded
partnership" that is taxed as a corporation.

h)  Use of Estimates

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United  States  requires  management  to make certain
estimates and assumptions relating to reporting of assets, liabilities, revenues
and expenses disclosed in the consolidated  financial  statements.  Accordingly,
actual results could differ from those estimates.

i) Net Income (Loss) per BAC

Net income  (loss) per BAC is  computed  based on the net income  (loss) for the
period attributed to BACs holders, divided by the number of BACs outstanding for
the period.


NOTE 3 - Fair Value of Financial Instruments

In  accordance  with SFAS No. 107  "Disclosures  about  Fair Value of  Financial
Instruments,"  the following  methods and assumptions  were used to estimate the
fair value of each class of financial instruments for which it is practicable to
estimate that value:

Cash and Cash  Equivalents,  Cash Held in  Escrow,  Accounts  Payable  and Other
--------------------------------------------------------------------------------
Liabilities,  Due to Local General  Partners and Affiliates,  and Due to General
--------------------------------------------------------------------------------
Partners and Affiliates
-----------------------
The carrying amount of cash and cash equivalents,  cash held in escrow, accounts
payable and other liabilities approximates fair value. The fair values of Due to
Local General Partners and Affiliates and Due to General Partners and Affiliates
are not readily determinable because no market exists for these instruments.

Mortgage Notes Payable
----------------------
The fair value of mortgage notes payable is estimated, where practicable,  based
on the borrowing rate currently available for similar loans.

The  estimated  fair values of the  Partnership's  mortgage  notes  payable from
operations are as follows:
<TABLE>
<CAPTION>
                                                March 31, 2007              March 31, 2006
                                          -------------------------   -------------------------
                                           Carrying                    Carrying
                                            Amount       Fair Value     Amount       Fair Value
                                          -----------   -----------   -----------   -----------
<S>                                       <C>           <C>           <C>           <C>
Mortgage Notes Payable for which it is:

Practicable to estimate fair value        $20,145,469   $20,145,469   $25,259,584   $25,259,584
Not Practicable                           $ 5,130,672           (*)   $ 8,137,816           (*)
</TABLE>

The  estimated  fair values of the  Partnership's  mortgage  notes  payable from
discontinued operations are as follows:
<TABLE>
<CAPTION>
                                                March 31, 2007              March 31, 2006
                                          -------------------------   -------------------------
                                           Carrying                    Carrying
                                            Amount       Fair Value     Amount       Fair Value
                                          -----------   -----------   -----------   -----------
<S>                                       <C>           <C>           <C>           <C>
Mortgage notes payable for which it is:
Practicable to estimate fair value        $         0   $         0   $22,675,897   $22,707,650
Not practicable                           $         0                 $ 3,792,464           (*)
</TABLE>

(*) Management  believes it is not practicable to estimate the fair value of the
    mortgage   notes   payable   because   mortgage    programs   with   similar
    characteristics are not currently available to the Local Partnerships.

                                       53
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          MARCH 31, 2007, 2006 and 2005


NOTE 4 - Property and Equipment

The components of property and equipment from operating assets are as follows:
<TABLE>
<CAPTION>
                                            March 31,               Estimated
                                  ----------------------------     Useful Lives
                                      2007            2006           (Years)
                                  ------------    ------------    -------------
<S>                               <C>             <C>                <C>
Land                              $  1,684,185    $  1,751,865          -
Buildings and improvements          45,157,303      66,026,433       15 to 40
Other                                1,856,263       2,068,795        5 to 15
                                  ------------    ------------
                                    48,697,751      69,847,093
Less:  Accumulated depreciation    (23,820,319)    (33,384,359)
                                  ------------    ------------
                                  $ 24,877,432    $ 36,462,734
                                  ============    ============
</TABLE>

Depreciation  expense for the years ended March 31, 2007, 2006 and 2005 amounted
to $1,531,541, $1,542,433 and $1,518,676, respectively.

During  the years  ended  March 31,  2007 and 2006,  there  were  write-offs  of
accumulated   depreciation   in  the  amounts  of  $47,195,095  and  $4,617,863,
respectively, and $47,144,833 and $4,614,956 of these write-offs were related to
discontinued assets.

The components of property and equipment held for sale are as follows:
<TABLE>
<CAPTION>
                                            March 31,               Estimated
                                  ----------------------------     Useful Lives
                                      2007            2006           (Years)
                                  ------------    ------------    -------------
<S>                               <C>             <C>                <C>
Land                              $          0    $  3,550,953          -
Buildings and improvements                   0      56,704,419       15 to 40
Other                                        0       6,188,293        5 to 15
                                  ------------    ------------
                                             0      66,443,665
Less:  Accumulated depreciation              0     (35,174,311)
                                  ------------    ------------
                                  $          0    $ 31,269,354
                                  ============    ============
</TABLE>

Depreciation  expense for the discontinued  assets for the years ended March 31,
2007,   2006  and  2005  amounted  to  $925,203,   $3,180,909  and   $3,309,187,
respectively.


NOTE 5 - Deferred Costs

The  components  of  deferred  costs  and their  periods  of  amortization  from
operating assets are as follows:
<TABLE>
<CAPTION>
                                            March 31,
                                  ----------------------------
                                      2007            2006
                                  ------------    ------------
<S>                               <C>             <C>
Financing expenses                $    448,927    $    448,927
Less:  Accumulated amortization       (204,969)       (189,345)
                                  ------------    ------------

                                  $    243,958    $    259,582
                                  ============    ============
</TABLE>

Amortization of deferred costs for the years ended March 31, 2007, 2006 and 2005
amounted to $15,624, $15,442 and $15,442, respectively.

During the years ended March 31, 2007 and 2006, there were decreases in deferred
costs of $2,377,498  and $0 and net  decreases in  accumulated  amortization  of
$2,183,617 and $0, respectively,  due to write-offs and  reclassifications  into
discontinued operations.

                                       54
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          MARCH 31, 2007, 2006 and 2005


The  components  of  deferred  costs  and their  periods  of  amortization  from
discontinued assets are as follows:
<TABLE>
<CAPTION>

                                            March 31,
                                  --------------------------
                                      2007           2006
                                  -----------    -----------
<S>                               <C>            <C>
Financing expenses                $         0    $ 2,377,498
Less:  Accumulated amortization             0     (2,088,679)
                                  -----------    -----------

                                  $         0    $   288,819
                                  ===========    ===========
</TABLE>

Amortization expense from discontinued  operations for the years ended March 31,
2007, 2006 and 2005 amounted to $94,938, $163,921 and $231,103, respectively.

Financing  expenses are being amortized over the life of the related  mortgages,
ranging from 15 to 50 years, using a method approximating the interest method.


NOTE 6 - Mortgage Notes Payable

The  mortgage   notes  are  payable  in  aggregate   monthly   installments   of
approximately  $167,000 including principal and interest with rates varying from
1% to 13.50% per annum and have  maturity  dates ranging from 2007 through 2042.
The  loans  are  collateralized  by the land  and  buildings  of the  subsidiary
partnerships,  the assignment of certain subsidiary partnerships' rents, leases,
and replacement reserves, and are without further recourse.

Annual principal  payments on the permanent debt requirements for mortgage notes
payable for each of the next five fiscal years and  thereafter for the operating
liabilities are as follows:
<TABLE>
<CAPTION>
                Year Ending March 31,     Amount
                ---------------------   ------------
                <C>                     <C>
                2007                    $ 2,107,086
                2008                        260,153
                2009                        278,529
                2010                        298,357
                2011                        319,813
                Thereafter               22,012,203
                                         ----------

                Total                   $25,276,141
                                        ===========
</TABLE>

Accrued  interest  payable  as of March  31,  2007  and  2006 was  approximately
$579,535 and $1,555,000,  respectively.  Interest accrues on all mortgage loans,
which  include  primary  and  secondary  loans.  Certain  secondary  loans  have
provisions  such that  interest is accrued but not payable  until a future date.
The  Partnership  anticipates  the payment of accrued  interest on the secondary
loans (which make up the  majority of the accrued  interest  payable  amount and
which  have  been  accumulating  since  the  Partnership's   investment  in  the
respective  Local  Partnership)  will be made from future  refinancings or sales
proceeds of the respective Local Partnerships.

As of March 31, 2007, there were no annual  principal  payments on the permanent
debt  requirements  for mortgage  notes payable for each of the next five fiscal
years and thereafter relating to the discontinued liabilities.

Accrued interest payable for the discontinued  liabilities at March 31, 2007 and
2006 was  approximately $0 and $338,000,  respectively.  Interest accrues on all
mortgage loans,  which include primary and secondary  loans.  Certain  secondary
loans have  provisions  such that  interest is accrued  but not payable  until a
future date. The Partnership  anticipates the payment of accrued interest on the
secondary  loans  (which make up the  majority of the accrued  interest  payable
amount and which have been accumulating  since the  Partnership's  investment in
the respective Local Partnership) will be made from future refinancings or sales
proceeds of the respective Local Partnerships.


NOTE 7 - Related Party  Transactions and Transactions  with General Partners and
Affiliates

Freedom SLP L.P., an affiliate of the General Partners,  has either a .01% or 1%
interest, as a special limited partner, in each of the Local Partnerships.

The General  Partners and their affiliates and the general partners of the Local
Partnerships  ("Local General  Partners") and their affiliates  perform services
for the Partnership and the Local Partnerships, respectively. The costs incurred
are as follows:

                                       55
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          MARCH 31, 2007, 2006 and 2005


a)  Due to Local General Partners and Affiliates

Due to Local General Partners and affiliates at March 31, 2007 and 2006 consists
of the following:
<TABLE>
<CAPTION>
                                           March 31,
                                   -----------------------
                                       2007        2006
                                   ----------   ----------
<S>                                <C>          <C>
Operating advances                 $  255,094   $  323,357
Development fees (i)                  610,024      610,024
Operating deficit loan (ii)                 0        6,490
Long-term note payable                 47,498       49,884
Management and other fees             165,496      191,431
                                   ----------   ----------

                                   $1,078,112   $1,181,186
                                   ==========   ==========
</TABLE>

(i) Development  fees were incurred in connection  with the  development  of the
    property and have been included in the basis of the property.

(ii) Operating deficit loan consists of the following:
<TABLE>
<CAPTION>
                                           March 31,
                                   -----------------------
                                       2007        2006
                                   ----------   ----------
<S>                                <C>          <C>
Ogontz Hall                        $        0   $    6,490
</TABLE>

This loan to fund operating deficits was unsecured, non-interest bearing and was
subordinate to the second mortgage and was paid out of available surplus cash of
the respective subsidiary partnership.

Due to Local General Partners and affiliates at March 31, 2007 and 2006 included
in the discontinued liabilities consists of the following:
<TABLE>
<CAPTION>
                                           March 31,
                                   -----------------------
                                       2007        2006
                                   ----------   ----------
<S>                                <C>          <C>
Operating advances                 $        0   $  252,928
Operating deficit loan (i)                  0      191,775
Management and other fees                   0      211,840
                                   ----------   ----------

                                   $        0   $  656,543
                                   ==========   ==========
</TABLE>

(i) Operating deficit loan consists of the following:
<TABLE>
<CAPTION>
                                           March 31,
                                   -----------------------
                                       2007        2006
                                   ----------   ----------
<S>                                <C>          <C>
Wilshire Apartments ("Wilshire")   $        0   $  191,775
</TABLE>

This loan to fund operating deficits was unsecured, non-interest bearing and was
paid at the time of sale. Wilshire was sold on June 26, 2006.

                                       56
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          MARCH 31, 2007, 2006 and 2005


b)  Other Expenses

The costs from operations  incurred to related parties for the years ended March
31, 2007, 2006 and 2005 were as follows:
<TABLE>
<CAPTION>
                                                                Years ended March 31,
                                                        ------------------------------------
                                                           2007         2006*        2005*
                                                        ----------   ----------   ----------
<S>                                                     <C>          <C>          <C>
Partnership management fees (a)                         $  475,025   $  670,875   $  676,000
Expense reimbursement (b)                                  166,350      353,440      223,042
Local administrative fee (d)                                23,500       21,000       20,500
                                                        ----------   ----------   ----------
Total general and administrative - General Partners        664,875    1,045,315      919,542
                                                        ----------   ----------   ----------
Property management fees incurred to affiliates
 of the subsidiary partnerships' general partners (c)      394,119      421,848      427,312
                                                        ----------   ----------   ----------
Total general and administrative - related parties      $1,058,994   $1,467,163   $1,346,854
                                                        ==========   ==========   ==========
</TABLE>
* Reclassified for comparative purposes.


The costs from discontinued operations incurred to related parties for the years
ended March 31, 2007, 2006 and 2005 were as follows:
<TABLE>
<CAPTION>
                                                                Years ended March 31,
                                                        ------------------------------------
                                                           2007         2006*        2005*
                                                        ----------   ----------   ----------
<S>                                                     <C>          <C>          <C>
Local administrative fee (d)                            $   17,686   $   28,850   $   30,693
                                                        ----------   ----------   ----------
Total general and administrative-General Partners           17,686       28,850       30,693
                                                        ----------   ----------   ----------
Property management fees incurred to affiliates
  of the Local General Partners (c)                        258,642      432,631      469,770
                                                        ----------   ----------   ----------

Total general and administrative-related parties        $  276,328   $  461,481   $  500,463
                                                        ==========   ==========   ==========
</TABLE>

* Reclassified for comparative purposes.


(a) The General  Partners are entitled to receive a partnership  management fee,
after payment of all Partnership expenses,  which together with the annual local
administrative  fees  will not  exceed a maximum  of 0.5% per annum of  Invested
Assets (as defined in the Partnership Agreement),  for administering the affairs
of  the  Partnership.  Subject  to the  foregoing  limitation,  the  partnership
management  fee  will be  determined  by the  General  Partners  in  their  sole
discretion  based upon their  review of the  Partnership's  investments.  Unpaid
partnership  management fees for any year will be accrued  without  interest and
will be payable  from  working  capital  reserves or to the extent of  available
funds after the Partnership has made  distributions  to the limited partners and
BACs holders of sale or refinancing  proceeds  equal to their  original  capital
contributions  plus a 10% priority return thereon (to the extent not theretofore
paid out of cash flow).  Partnership  management  fees owed to General  Partners
amounting to approximately  $2,948,000 and $7,555,000 were accrued and unpaid as
of March 31, 2007 and 2006, respectively.  During the year ended March 31, 2007,
management  deemed the unpaid  partnership  management fees that were related to
sold properties  uncollectible and, as a result, wrote them off in the amount of
approximately  $4,096,000,  resulting in a non-cash General Partner contribution
of the same amount.  Without the General  Partners'  continued  accrual  without
payment, the Partnership will not be in a position to meet its obligations.  The
General  Partners have continued  allowing the accrual  without payment of these
amounts, but are under no obligation to continue to do so.

(b) The  Partnership  reimburses the General  Partners and their  affiliates for
actual Partnership operating expenses incurred by the General Partners and their
affiliates on the  Partnership's  behalf.  The amount of reimbursement  from the
Partnership is limited by the provisions of the Partnership  Agreement.  Another
affiliate of the General Partners performs asset monitoring for the Partnership.
These   services   include  site  visits  and   evaluations  of  the  subsidiary
partnerships' performance.

(c) Property  management  fees incurred by subsidiary  partnerships  amounted to
$775,439, $1,063,422 and $1,076,574 for the years ended March 31, 2007, 2006 and
2005, respectively. Of these fees, $652,761, $854,479 and $897,082 were incurred
to affiliates of the subsidiary partnerships,  which include $258,642,  $432,631
and $469,770, respectively, of fees relating to discontinued operations.

(d) Freedom SLP L.P., a special limited partner of the subsidiary  partnerships,
is entitled to receive an annual local  administrative  fee of up to $2,500 from
each Local Partnership.

                                       57
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          MARCH 31, 2007, 2006 and 2005


NOTE 8 - Income Taxes

A reconciliation of the financial  statement net loss to the income tax loss for
the Partnership and its consolidated subsidiaries follows:
<TABLE>
<CAPTION>
                                                  2006            2005            2004
                                              ------------    ------------    ------------
<S>                                           <C>             <C>             <C>
Financial statement
Net income (loss)                             $ 11,832,161    $ (3,792,044)   $ (4,219,638)

Difference resulting from parent company
 having a different  fiscal year for
 income tax and financial reporting
 purposes                                         (173,228)       (369,620)        376,180

Tax-exempt interest income                        (207,839)         (1,326)            (40)

Difference between depreciation and
 amortization expense recorded for
 financial statement and income tax
 reporting purposes                             (1,825,966)       (554,379)        468,213

Provisions for loss on impairment                1,505,824         555,000               0

Difference between gain on sale of
 properties for financial reporting
 purposes and income tax purposes               (4,650,754)              0               0

Difference between gains and losses
 allocated to minority interest for
 financial reporting purposes and tax
 purposes                                       (2,312,762)              0               0

Difference resulting from forgiveness of
 related  party debt  considered  a
 General Partner contribution for financial
 reporting purposes and income for
 tax purposes                                    4,095,540               0               0

 Other                                            (324,552)        496,704        (154,830)
                                              ------------    ------------    ------------

 Net loss as shown on the Partnership's
  income tax returns                          $  7,938,424    $ (3,665,665)   $ (3,530,115)
                                              ============    ============    ============
</TABLE>


NOTE 9 - Sale of Properties

The Partnership is currently in the process of disposing of its investments.  As
of March 31, 2007, the Partnership's  limited partnership interest in nine Local
Partnerships and the property and the related assets and liabilities of thirteen
Local  Partnerships  have been sold.  There can be no  assurance  as to when the
Partnership will dispose of its remaining  investments or the amount of proceeds
which may be received. However, based on the historical operating results of the
Local Partnerships and the current economic conditions, including changes in tax
laws,  it is  unlikely  that  the  proceeds  from  such  sales  received  by the
Partnership  will be sufficient to return to the limited partners their original
investments.  All  gains  and  losses  on sales  are  included  in  discontinued
operations. Subsequently, on April 30, 2007, six Local Partnerships entered into
agreements to sell their property and the related assets and liabilities, and on
May 3,  2007,  the  Partnership's  limited  partnership  interest  in one  Local
Partnership was sold (see Item 8, Note 13).

On January 31,  2007,  the property and the related  assets and  liabilities  of
Eagle Ridge Limited  Partnership  ("Eagle  Ridge") were sold to an  unaffiliated
third party purchaser for a sales price of $2,000,000.  The Partnership received
$412,730 as a  distribution  from this sale after the  repayment  of  mortgages,
other  liabilities,  closing costs and  distributions  to minority  interests of
approximately $1,587,000.  The sale resulted in a gain of approximately $600,000
resulting  from the write-off of the partners'  deficit basis in the property of
approximately  $600,000  at the  date of the  sale.  The  sale  resulted  in the
liquidation of Eagle Ridge.

On January 10,  2007,  the property and the related  assets and  liabilities  of
Lauderdale Lakes Associates, Ltd. ("Lauderdale Lakes") were sold to an affiliate
of the Local General  Partner for a sales price of $5,900,000.  The  Partnership
received  $790,773  as a  distribution  from this sale  after the  repayment  of
mortgages,  other  liabilities  and closing costs of  approximately  $5,109,000.
During the quarter  ended  December 31, 2006, in  accordance  with  Statement of
Financial  Accounting  Standards  No. 144,  "Accounting  for the  Impairment  or
Disposal of Long-Lived  Assets"  ("SFAS No. 144"),  the  Partnership  deemed the
building  impaired and wrote it down to its fair value which  resulted in a loss
on impairment of approximately $1,106,000.  Because Lauderdale Lakes was sold to
a related  party of the  Local  Partnership,  the sale  resulted  in a  non-cash
distribution  from  the  Local  Partnership  to the  Local  General  Partner  of
approximately  $329,000.  Such distribution flows through minority interest as a
result of the write-off of the partners' basis in the property of  approximately
$329,000. The sale resulted in the liquidation of Lauderdale Lakes.

                                       58
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          MARCH 31, 2007, 2006 and 2005


On January 1, 2007, the Partnership's  limited  partnership  interest in Harmony
Associates,  L.P.  ("Harmony  Gate") was sold to the Local General Partner for a
sales price of $1,409,990.  The Partnership received proceeds of $1,409,990 from
the  sale.  Because  Harmony  Gate was  sold to a  related  party  of the  Local
Partnership,  the  sale  resulted  in  a  non-cash  contribution  to  the  Local
Partnership  from the Local General Partner of  approximately  $1,211,000.  Such
contribution flows through minority interest as a result of the write-off of the
partners'  basis in the property of  approximately  $199,000 and the  $1,409,990
cash received from the sale.

On January 1, 2007, the Partnership's  limited  partnership  interest in Conifer
Irondequoit Associates ("Abraham Lincoln") was sold to the Local General Partner
for a sales price of $1. Because  Abraham Lincoln was sold to a related party of
the Local Partnership, the sale resulted in a non-cash contribution to the Local
Partnership  from the Local  General  Partner of  approximately  $127,000.  Such
contribution flows through minority interest as a result of the write-off of the
partners' deficit basis in the property of approximately $127,000 at the date of
the  sale.  The sale  also  resulted  in a  non-cash  contribution  to the Local
Partnership  from an affiliate  of the Local  General  Partner of  approximately
$20,000 as a result of the write-off of payables owed by the Local  Partnership.
The sale resulted in the liquidation of Abraham Lincoln.

On October 25, 2006, the property and the related assets and  liabilities of C-H
Development Group Associates,  L.P. ("Manhattan B") were sold to an unaffiliated
third party purchaser for a sales price of $2,100,000.  The Partnership received
$850,980 as a  distribution  from this sale after the  repayment  of  mortgages,
other  liabilities  and  closing  costs of  approximately  $1,249,000.  The sale
resulted in a gain of approximately $842,000 resulting from the write-off of the
partners' deficit basis in the property of approximately $842,000 at the date of
the sale. The sale resulted in the liquidation of Manhattan B.

On September 29, 2006,  the property and the related  assets and  liabilities of
Oxford Trace  Apartments  ("Oxford  Trace") were sold to an  unaffiliated  third
party purchaser for a sales price of $725,000.  The Partnership received $49,279
as a  distribution  from  this sale  after the  repayment  of  mortgages,  other
liabilities and closing costs of approximately  $676,000. The sale resulted in a
gain of  approximately  $373,000  resulting  from the write-off of the partners'
deficit basis in the property of approximately $373,000 at the date of the sale.
The sale also resulted in a non-cash  contribution to the Local Partnership from
the Local General Partner of approximately $494,000 as a result of the write-off
of payables owed by the Local Partnership.  The sale resulted in the liquidation
of Oxford Trace.

On September 29, 2006,  the property and the related  assets and  liabilities of
Tivoli Place  Apartments  ("Tivoli  Place") were sold to an  unaffiliated  third
party  purchaser  for a sales  price of  $3,050,000.  The  Partnership  received
$1,331,631  as a  distribution  from this sale after the repayment of mortgages,
other  liabilities,  closing costs and  distributions  to minority  interests of
approximately $1,711,000.  The sale resulted in a gain of approximately $905,000
resulting  from the write-off of the partners'  deficit basis in the property of
approximately  $905,000  at the date of the sale.  The sale also  resulted  in a
non-cash distribution from the Local Partnership to the Local General Partner of
approximately  $62,000 as a result of the write-off of  receivables  owed to the
Local Partnership. The sale resulted in the liquidation of Tivoli Place.

On September 20, 2006,  the property and the related  assets and  liabilities of
Bennion Park Apartments  ("Mulberry")  were sold to an unaffiliated  third party
purchaser for a sales price of $4,900,000.  The Partnership  received $2,321,740
as a  distribution  from  this sale  after the  repayment  of  mortgages,  other
liabilities,   closing  costs  and   distributions  to  minority   interests  of
approximately  $2,578,000.   The  sale  resulted  in  a  gain  of  approximately
$2,183,000  resulting  from the write-off of the partners'  deficit basis in the
property  of  approximately  $2,183,000  at the date of the sale.  The sale also
resulted  in a non-cash  distribution  from the Local  Partnership  to the Local
General  Partner  of  approximately  $980,000  as a result of the  write-off  of
receivables owed to the Local Partnership.  The sale resulted in the liquidation
of Mulberry.

On September 20, 2006,  the property and the related  assets and  liabilities of
Twin Trees  Apartments  ("Twin Trees") were sold to an unaffiliated  third party
purchaser for a sales price of $2,300,000.  The Partnership received $927,148 as
a  distribution  from  this  sale  after  the  repayment  of  mortgages,   other
liabilities,   closing  costs  and   distributions  to  minority   interests  of
approximately $1,373,000.  The sale resulted in a gain of approximately $904,000
resulting  from the write-off of the partners'  deficit basis in the property of
approximately  $904,000  at the date of the sale.  The sale also  resulted  in a
non-cash distribution from the Local Partnership to the Local General Partner of
approximately  $582,000 as a result of the write-off of receivables  owed to the
Local Partnership. The sale resulted in the liquidation of Twin Trees.

On July 26,  2006,  the  property  and the  related  assets and  liabilities  of
Washington  Brooklyn  Limited   Partnership   ("Washington")  were  sold  to  an
unaffiliated  third party purchaser for a sales price of approximately  $160,000
and the  assumption  of the  related  mortgage  liabilities  and the  litigation
discussed in Note 10. After the repayment of other liabilities and closing costs
of approximately  $60,000,  the Partnership  will receive an additional  payment
estimated  to be  approximately  $100,000  to be paid at a later  date  upon the
settlement of a foreclosure dispute (see Note 10). During the quarter ended June
30, 2006, in accordance with SFAS No. 144, the  Partnership  deemed the building
impaired  and  wrote  it down to its  fair  value  which  resulted  in a loss on
impairment of $400,000.  The sale resulted in a loss of  approximately  $384,000
resulting  from  the  write-off  of  the  partners'  basis  in the  property  of
approximately  $384,000  at the date of the sale.  The sale also  resulted  in a
non-cash  contribution to the Local  Partnership  from an affiliate of the Local
General  Partner  of  approximately  $30,000  as a result  of the  write-off  of
payables  owed by Local  Partnership.  The sale resulted in the  liquidation  of
Washington.

On June 26, 2006, the property and the related assets and liabilities of Hunters
Chase  Apartments  ("Hunters  Chase") were sold to an  unaffiliated  third party
purchaser for a sales price of $2,730,000.  The Partnership received $334,243 as
a  distribution  from  this  sale  after  the  repayment  of  mortgages,   other
liabilities and closing costs of approximately $2,396,000.  The sale resulted in
a gain of approximately $1,192,000 resulting from the write-off of the partners'
deficit  basis in the property of  approximately  $1,192,000  at the date of the
sale,  which was  recorded  during the quarter  ended  September  30,  2006.  An
adjustment to the gain of approximately  $72,000 was recorded during the quarter
ended December 31, 2006, resulting in overall gain of approximately  $1,264,000.
The sale also resulted in a non-cash  contribution to the Local Partnership from
the  Local  General  Partner  of  approximately  $1,245,000  as a result  of the
write-off of payables  owed by the Local  Partnership.  The sale resulted in the
liquidation of Hunters Chase.

                                       59
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          MARCH 31, 2007, 2006 and 2005


On June 26,  2006,  the  property  and the  related  assets and  liabilities  of
Wilshire  Apartments  ("Wilshire")  were  sold to an  unaffiliated  third  party
purchaser for a sales price of $1,700,000. The Partnership received $31,986 as a
distribution from this sale after the repayment of mortgages,  other liabilities
and closing costs of  approximately  $1,668,000.  The sale resulted in a gain of
approximately  $680,000  resulting  from the write-off of the partners'  deficit
basis in the property of  approximately  $680,000 at the date of the sale, which
was recorded during the quarter ended September 30, 2006. A downward  adjustment
to the gain of  approximately  $161,000  was recorded  during the quarter  ended
December 31, 2006, resulting in overall gain of approximately $519,000. The sale
also resulted in a non-cash contribution to the Local Partnership from the Local
General  Partner of  approximately  $1,179,000  as a result of the  write-off of
payables owed by the Local Partnership.  The sale resulted in the liquidation of
Wilshire.

On June 20, 2006, the property and the related assets and  liabilities of Bethel
Park  Apartments  ("Bethel  Park")  were  sold to an  unaffiliated  third  party
purchaser for a sales price of $2,500,000.  The Partnership received $620,674 as
a  distribution  from  this  sale  after  the  repayment  of  mortgages,   other
liabilities and closing costs of approximately $1,879,000.  The sale resulted in
a gain of approximately  $319,000  resulting from the write-off of the partners'
deficit basis in the property of approximately $319,000 at the date of the sale,
which was recorded during the quarter ended September 30, 2006. An adjustment to
the gain of  approximately  $11,000 was recorded  during the quarter ended March
31, 2007,  resulting in overall gain of  approximately  $330,000.  The sale also
resulted  in a non-cash  contribution  to the Local  Partnership  from the Local
General  Partner  of  approximately  $298,000  as a result of the  write-off  of
payables owed by the Local Partnership.  The sale resulted in the liquidation of
Bethel Park.

On June 20, 2006, the property and the related assets and liabilities of Zebulon
Park Apartments  ("Zebulon") were sold to an unaffiliated  third party purchaser
for a  sales  price  of  $2,000,000.  The  Partnership  received  $420,305  as a
distribution from this sale after the repayment of mortgages,  other liabilities
and closing costs of  approximately  $1,580,000.  The sale resulted in a gain of
approximately  $115,000  resulting  from the write-off of the partners'  deficit
basis in the property of  approximately  $115,000 at the date of the sale, which
was recorded during the quarter ended September 30, 2006. A downward  adjustment
to the gain of  approximately  $3,000  was  recorded  during the  quarter  ended
December 31, 2006, resulting in overall gain of approximately $112,000. The sale
also resulted in a non-cash contribution to the Local Partnership from the Local
General  Partner  of  approximately  $264,000  as a result of the  write-off  of
payables owed by the Local Partnership.  The sale resulted in the liquidation of
Zebulon.

On June 5,  2006,  the  property  and the  related  assets  and  liabilities  of
Northwood Apartments of Georgia ("Northwood") were sold to an unaffiliated third
party  purchaser  for a sales  price of  $6,050,000.  The  Partnership  received
$3,197,019  as a  distribution  from this sale after the repayment of mortgages,
other  liabilities,  closing costs and  distributions  to minority  interests of
approximately  $2,853,000.   The  sale  resulted  in  a  gain  of  approximately
$2,367,000  resulting from the write-off of the partners'  basis in the property
of  approximately  $2,367,000 at the date of the sale, which was recorded during
the quarter ended September 30, 2006. An adjustment to the gain of approximately
$81,000 was  recorded  during the quarter  ended March 31,  2007,  resulting  in
overall gain of approximately  $2,448,000.  The sale also resulted in a non-cash
distribution  from  the  Local  Partnership  to the  Local  General  Partner  of
approximately  $868,000 as a result of the write-off of receivables  owed to the
Local Partnership. The sale resulted in the liquidation of Northwood.

On March 31, 2006, the Partnership's  limited  partnership  interest in Davidson
Court  Limited  Partnership  ("Davidson  Court") was sold to an affiliate of the
general  partner of the Local  Partnership  (the "Local General  Partner") for a
sales price of $1,100,000.  The Partnership received proceeds of $1,066,715 from
this sale after the payment of closing costs of  approximately  $33,000 from the
sales price.  Because  Davidson  Court was sold to a related  party of the Local
Partnership,  the  sale  resulted  in  a  non-cash  contribution  to  the  Local
Partnership  from the Local  General  Partner  of  approximately  $68,000.  Such
contribution flows through minority interest as a result of the write-off of the
partners'  basis in the property of  approximately  $999,000 and the  $1,066,715
cash received from the sale.

On March  31,  2006,  the  Partnership's  limited  partnership  interest  in CLM
Equities  Limited  Partnership  ("Morris  Avenue") was sold to the Local General
Partner  and its  affiliate  for a sales  price  of  $265,000.  The  Partnership
received proceeds of $264,990 from this sale.  Because Morris Avenue was sold to
a related  party of the  Local  Partnership,  the sale  resulted  in a  non-cash
distribution  from  the  Local  Partnership  to the  Local  General  Partner  of
approximately  $424,000,  which was recorded  during the quarter  ended June 30,
2006. A downward  adjustment  of  approximately  $9,000 was recorded  during the
quarter ended December 31, 2006,  resulting in overall non-cash  distribution of
approximately  $415,000.  Such distribution flows through minority interest as a
result of the write-off of the partners' basis in the property of  approximately
$680,000 and the $264,990 cash received from the sale.

On February 1, 2006, the Partnership's  limited partnership  interest in Ivanhoe
Apartments Limited Partnership ("Ivanhoe") was sold to the Local General Partner
for a sales price of $150,000.  The  Partnership  received  proceeds of $150,000
from  this  sale.  Because  Ivanhoe  was sold to a  related  party of the  Local
Partnership,  the sale  resulted  in a  non-cash  distribution  from  the  Local
Partnership to the Local General  Partner of  approximately  $50,000,  which was
recorded  during the quarter  ended June 30, 2006. An adjustment to the non-cash
distribution  of  approximately  $35,000 was recorded  during the quarter  ended
March 31, 2007,  resulting in overall  non-cash  distribution  of  approximately
$85,000.  Such  distribution  flows through minority interest as a result of the
write-off of the partners' basis in the property of  approximately  $235,000 and
the $150,000 cash  received from the sale.  The sale also resulted in a non-cash
contribution to the Local  Partnership  from an affiliate of the General Partner
of approximately  $35,000 as a result of the write-off of payables owed by Local
Partnership.

On January 19, 2006, the Partnership's  limited  partnership  interest in Nelson
Anderson Affordable Housing Limited Partners ("Nelson Anderson") was sold to the
Local General Partner for a sales price of $490,000.  The  Partnership  received
proceeds of  $489,990  from this sale.  Because  Nelson  Anderson  was sold to a
related  party  of the  Local  Partnership,  the  sale  resulted  in a  non-cash

                                       60
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          MARCH 31, 2007, 2006 and 2005


distribution  from  the  Local  Partnership  to the  Local  General  Partner  of
approximately  $196,000,  which was recorded  during the quarter  ended June 30,
2006. A downward adjustment to the non-cash distribution of approximately $1,000
was  recorded  during the quarter  ended March 31,  2007,  resulting  in overall
non-cash distribution of approximately $197,000. Such distribution flows through
minority  interest as a result of the  write-off of the  partners'  basis in the
property of approximately $687,000 and the $489,990 cash received from the sale.
The sale also resulted in a non-cash  contribution to the Local Partnership from
an affiliate of the General Partner of approximately  $28,000 as a result of the
write-off of payables owed by Local Partnership.

On January 1, 2006, the Partnership's limited partnership interest in Greenfield
Village Limited Partnership ("Greenfield Village") was sold to the Local General
Partner for a sales  price of  $75,000.  The  Partnership  received  proceeds of
$74,990 from the sale. Because Greenfield Village was sold to a related party of
the Local Partnership, the sale resulted in a non-cash contribution to the Local
Partnership from the Local General Partner of approximately $461,000,  which was
recorded  during the  quarter  ended March 31,  2006.  Such  contribution  flows
through minority  interest as a result of the write-off of the partners' deficit
basis in the property of  approximately  $386,000 and the $74,990 cash  received
from the sale.

On January 1, 2006, the Partnership's  limited partnership  interest in The Oaks
Village  Limited  Partnership  ("Oaks  Village")  was sold to the Local  General
Partner for a sales  price of  $75,000.  The  Partnership  received  proceeds of
$74,990 from this sale.  Because Oaks Village was sold to a related party of the
Local  Partnership,  the sale resulted in a non-cash  contribution  to the Local
Partnership from the Local General Partner of approximately $407,000,  which was
recorded  during the  quarter  ended March 31,  2006.  Such  contribution  flows
through minority  interest as a result of the write-off of the partners' deficit
basis in the property of  approximately  $332,000 and the $74,990 cash  received
from the sale.

On June 20, 2005, the  Partnership's  limited  partnership  interest in Parkside
Townhomes  Associates  ("Parkside")  was sold to the Local General Partner for a
sales price of $650,000. The Partnership received $611,140, after the payment of
closing costs of approximately  $39,000, which included $161,140 paid in cash at
closing and $450,000  pursuant to a promissory  note payable to the  Partnership
(which was paid off in full as of December 31,  2006).  During the quarter ended
June 30,  2005,  in  accordance  with SFAS No. 144, the  Partnership  deemed the
building  impaired and wrote it down to its fair value which  resulted in a loss
on impairment of $555,000.  Because  Parkside was sold to a related party of the
Local Partnership,  the sale resulted in a non-cash  distribution from the Local
Partnership  to  the  Local  General  Partner  of  approximately  $32,000.  Such
distribution flows through minority interest as a result of the write-off of the
partners' basis in the property of approximately  $643,000 and the $611,140 cash
received from the sale.

NOTE 10 - Commitments and Contingencies

Washington
----------
On July 26, 2006,  the sale of Washington was completed (see Note 9) pursuant to
the purchase and sale  agreement.  Upon closing,  the  purchaser  assumed all of
Washington's  rights and  liabilities  with respect to the litigation  described
below.

In  or  about  September  2003,  a  putative  mortgagee   commenced  a  mortgage
foreclosure  action in the Supreme Court of the State of New York,  Kings County
(the  "Court"),  entitled  150 Beach 120th  Street Inc. v.  Washington  Brooklyn
Limited  Partnership,  Index No. 35255/2003,  seeking to foreclose on an alleged
$100,000 loan and mortgage  against the real property (the "Apartment  Complex")
owned by Washington. Apparently, the former general partner of Washington, BUFNY
Houses of  Brooklyn,  Inc.  ("BUFNY"),  allegedly  granted two  mortgages in the
amounts of $225,000 and $100,000 secured by the Apartment  Complex.  Each of the
foregoing  mortgages was granted without the knowledge of Freedom SLP, L.P. (the
"Special Limited  Partner") or the Partnership  (collectively the "Freedom LPs")
or the  consent of the Special  Limited  Partner,  as  required by  Washington's
Amended  and  Restated   Agreement  of  Limited   Partnership  (the  "Washington
Partnership  Agreement").  The Freedom  LPs  believe  that BUFNY did not use the
alleged loan proceeds for the benefit of  Washington  or the Apartment  Complex.
For these and other reasons,  the Freedom LPs contend that the alleged mortgages
are invalid.

In addition, BUFNY allegedly failed to comply with the terms of either mortgage,
which resulted in the holders of the alleged  $100,000  mortgage  commencing the
foreclosure  proceedings.  BUFNY did not appear in or  otherwise  respond to the
foreclosure  proceedings.  The holders of the alleged $225,000 mortgage have not
yet, to the knowledge of the Freedom LPs, commenced any foreclosure proceedings.

Due to  BUFNY's  breach of  fiduciary  duties  and  breaches  of the  Washington
Partnership  Agreement,  the Special Limited Partner  exercised its rights under
the Washington  Partnership  Agreement to remove BUFNY as  Washington's  general
partner  and to  substitute  itself  as the  new  replacement  general  partner,
effective April 26, 2004.

Shortly  after the Freedom LPs became  aware of these  foreclosure  proceedings,
their counsel  contacted  counsel for the plaintiffs and mortgagees in an effort
to learn more about the alleged  mortgages and to resolve the disputes  relating
to the mortgages.  When those efforts failed,  the Freedom LPs filed a motion to
intervene  in the  foreclosure  action  and to file a late  answer  on behalf of
themselves  and  Washington.  The  Freedom LPs contend  that the  mortgages  are
invalid  and  that   Washington  is  not  liable  for  them  or  the  underlying
indebtedness. In an order dated September 7, 2004, the Court granted the Freedom
LPs' motion to intervene and to file a late answer on behalf of Washington.

On or about  September 21, 2004,  the Freedom LPs, on behalf of  themselves  and
Washington, served an answer, counterclaims and crossclaims in defending against
the action.  The answer  denied the material  allegations  of the  complaint and
asserted certain  affirmative  defenses,  counterclaims  and crossclaims.  Among
other things, the Freedom LPs, on behalf of themselves and Washington, added The
Levites  Organization,  one of the two  co-holders of the $225,000  mortgage for
which the  plaintiffs'  complaint  did not seek  foreclosure,  as an  additional
counterclaim defendant,  and the Freedom LPs asserted that both the $100,000 and
$225,000 mortgages are invalid and void ab initio.

After  obtaining  discovery  from the putative  mortgagees,  Washington  and the
Freedom LPs on July 12, 2005 made a motion for summary  judgment  dismissing the
complaint and declaring the mortgages  invalid and void ab initio.  The putative
mortgagees  cross-moved for summary  judgment  declaring the mortgages valid and
enforceable.  Subsequently,  by decision dated January 3, 2006, the Court denied
both  motions,  finding  that  questions  of  fact  exist  for  trial  as to the
reasonableness of the putative mortgagees' reliance on BUFNY.

                                       61
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          MARCH 31, 2007, 2006 and 2005


On February 14, 2006,  the Freedom LPs filed a notice of appeal from the January
3, 2006 decision.

On July 18,  2006,  the  Freedom  LPs  perfected  their  appeal from the Court's
January 3, 2006 decision.

Abraham Lincoln
---------------
Beginning in October 2005,  Abraham  Lincoln ceased to make its monthly loan and
escrow  payments  to New York  State  Housing  Finance  Agency  ("NYSHFA").  The
mortgage  insurer  made the payments  for Abraham  Lincoln.  During 2006 Abraham
Lincoln  remitted  payments  to the  mortgage  insurer to  reimburse  it for its
payments.  At December 31,  2006,  the  un-reimbursed  amounts owed the mortgage
insurer  amounted to $12,716.  In January 2007,  Abraham Lincoln  reimbursed the
mortgage insurer for this balance.  In addition,  the NYSHFA has applied the two
month deposit of mortgage  payments to the delinquent loan and escrow  payments.
These items  technically  represent  an event of default  under the various loan
agreements,  which could result in both of the lenders demanding  immediate full
payment of the respective loans (the mortgages are called).  Abraham Lincoln has
not solicited a "covenant  waiver"  letter from the lenders;  however,  based on
history,  management  does  not  believe  any  of  the  loans  will  be  called.
Accordingly,  the loans are classified as  non-current in the balance sheet.  In
the event that any or all of the  mortgages  are called,  there is no  assurance
that a refinancing on comparable terms could be accomplished.  The Partnership's
investment  in Abraham  Lincoln was reduced to zero as a result of prior  years'
losses. On January 1, 2007, the Partnership's  limited  partnership  interest in
Abraham Lincoln was sold (see Note 9).

Pine Shadow, Ltd. ("Pine Shadow")
---------------------------------
During  2005,  Pine Shadow  suffered  damages  from  flooding  due to  Hurricane
Katrina.  However,  in 2006,  Pine Shadow  entered into an agreement  with Rural
Housing  Services  ("RHS") in which Pine Shadow is to receive funding to replace
all damages to the property. The funds to be received will be a Second Soft Loan
in the amount of $4,384,000  with an annual interest rate of 1%. Payments on the
loan will be deferred for a 20 year period. In accordance with SFAS No. 144, the
Partnership has determined that there is no impairment and the carrying  amounts
of the assets are recoverable, therefore, no adjustments are required. As of the
filing date of this report, the funds have not yet been received.

Other
-----

The  Partnership is subject to risks  incident to potential  losses arising from
the management and ownership of improved real estate.  The  Partnership can also
be affected by poor economic conditions  generally,  however no more than 30% of
the properties are located in any single state. There are also substantial risks
associated with owning properties receiving government  assistance,  for example
the  possibility  that  Congress  may not  appropriate  funds to enable the U.S.
Department of Housing and Urban  Development  ("HUD") to make rental  assistance
payments.  HUD also  restricts  annual cash  distributions  to partners based on
operating  results and a percentage of the owners'  equity  contribution.  As of
March 31,  2007,  there were three Local  Partnerships  subsidized  by HUD.  The
Partnership cannot sell or substantially liquidate its investments in subsidiary
partnerships  during the period that the  subsidy  agreements  are in  existence
without  HUD's  approval.  Furthermore  there  may  not  be  market  demand  for
apartments at full market rents when the rental assistance contract expires.

Except as  described  above,  management  is not aware of any  trends or events,
commitments or uncertainties, which have not otherwise been disclosed, that will
or are likely to impact  liquidity in a material  way.  Management  believes the
only impact would be from laws that have not yet been adopted.  The portfolio is
diversified by the location of the  properties  around the United States so that
if one  area of the  country  is  experiencing  downturns  in the  economy,  the
remaining  properties  in the  portfolio  may  not  be  affected.  However,  the
geographic  diversification  of the portfolio may not protect  against a general
downturn in the national economy.


NOTE 11 - Discontinued Operations

The following table summarizes the financial  position of the Local Partnerships
that are classified as  discontinued  operations  because the  respective  Local
Partnerships  were  classified  as assets held for sale.  As of March 31,  2007,
there were no Local  Partnerships  classified as discontinued  operations in the
consolidated  balance  sheets.  The amounts  shown below,  as of March 31, 2007,
represent  residual cash and accounts  payable  balances as of the balance sheet
date from the sale of Washington,  which  subsequently got paid. As of March 31,
2006,  Parkside,  Oaks Village,  Greenfield Village,  Nelson Anderson,  Ivanhoe,
Davidson Court, Morris Avenue, Bethel Park,  Northwood,  Hunters Chase, Mulberry
Park, Oxford Trace,  Tivoli Place,  Twin Trees,  Wilshire,  Zebulon,  Lauderdale
Lakes  and  Eagle  Ridge  were  classified  as  discontinued  operations  in the
consolidated financial statements.

                                       62
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          MARCH 31, 2007, 2006 and 2005


Consolidated Balance Sheets:
<TABLE>
<CAPTION>
                                                                March 31,     March 31,
                                                                  2007          2006
                                                              -----------   -----------
<S>                                                           <C>           <C>
Assets
  Property and equipment - less accumulated depreciation of
    $0 and $35,174,311 and, respectively                      $         0   $31,269,354
  Cash and cash equivalents                                         1,704     1,267,871
  Cash held in escrow                                                   0     1,219,590
  Deferred costs, net of accumulated amortization of $0
    and $2,088,679, respectively                                        0       288,819

  Other assets                                                          0       755,335
                                                              -----------   -----------
Total assets                                                  $     1,704   $34,800,969
                                                              ===========   ===========

Liabilities
  Mortgage notes payable                                      $         0   $26,468,361
  Accounts payable and other liabilities                            7,113     1,339,733
  Due to local general partners and affiliates                          0       656,543
  Due to general partners and affiliates                                0       270,000

  Minority interest                                                     0     4,189,575
                                                              -----------   -----------
Total liabilities                                             $     7,113   $32,924,212
                                                              ===========   ===========
</TABLE>

The  following  table   summarizes  the  results  of  operations  of  the  Local
Partnerships that are classified as discontinued operations.  For the year ended
March 31, 2007,  Bethel Park,  Northwood,  Hunters Chase,  Mulberry Park, Oxford
Trace,  Tivoli Place, Twin Trees,  Wilshire,  Zebulon,  Lauderdale Lakes,  Eagle
Ridge,  Washington,  Manhattan B, Abraham Lincoln and Harmony Gates,  which were
sold during the year, and Nelson  Anderson,  Ivanhoe,  Davidson Court and Morris
Avenue  were all  classified  as  discontinued  operations  on the  consolidated
financial statements. For the year ended March 31, 2006, Parkside, Oaks Village,
Greenfield Village, Nelson Anderson,  Ivanhoe, Davidson Court and Morris Avenue,
which were sold during the year, and in order to present  comparable  results to
the year ended March 31, 2007, Bethel Park,  Northwood,  Hunters Chase, Mulberry
Park, Oxford Trace,  Tivoli Place,  Twin Trees,  Wilshire,  Zebulon,  Lauderdale
Lakes, Eagle Ridge,  Washington,  Manhattan B, Abraham Lincoln and Harmony Gates
were all classified as  discontinued  operations on the  consolidated  financial
statements.  For the year ended  March 31,  2005 in order to present  comparable
results to the year ended March 31, 2007,  Parkside,  Oaks  Village,  Greenfield
Village, Nelson Anderson,  Ivanhoe,  Davidson Court, Morris Avenue, Bethel Park,
Northwood, Hunters Chase, Mulberry Park, Oxford Trace, Tivoli Place, Twin Trees,
Wilshire,  Zebulon,  Lauderdale  Lakes,  Eagle Ridge,  Washington,  Manhattan B,
Abraham Lincoln and Harmony Gates were all classified as discontinued operations
on the consolidated financial statements.

                                       63
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          MARCH 31, 2007, 2006 and 2005


Consolidated Statements of Discontinued Operations:
<TABLE>
<CAPTION>
                                                                           Years Ended March 31,
                                                                --------------------------------------------
                                                                    2007            2006*           2005*
                                                                ------------    ------------    ------------
<S>                                                             <C>             <C>             <C>
Revenues

Rental income                                                   $  5,941,721    $  9,547,440    $  9,735,435
Other (Note 2)                                                       313,596         612,395         602,271
Gain (loss) on sale of properties (Note 9)                        10,090,931         (81,351)              0
                                                                ------------    ------------    ------------
Total revenue                                                     16,346,248      10,078,484      10,337,706
                                                                ------------    ------------    ------------

Expenses

Repairs and maintenance                                            1,181,161       1,758,938       1,626,368
Operating and other                                                  972,844       1,623,134       1,496,246
Real estate taxes                                                    314,716         662,789         733,701
Interest                                                           2,035,317       2,547,474       2,665,214
Depreciation and amortization                                      1,020,141       3,344,830       3,540,290
General and administrative                                         1,448,137       2,408,046       2,345,225
General and administrative-related parties (Note 8)                  276,328         461,481         500,463
Loss on impairment of fixed assets                                 1,505,824         555,000               0
                                                                ------------    ------------    ------------

Total expenses                                                     8,754,468      13,361,692      12,907,507
                                                                ------------    ------------    ------------

Income (loss) from discontinued operations before
  minority interest                                                7,591,780      (3,283,208)     (2,569,801)
Minority interest in income (loss) of subsidiaries from
  discontinued operations                                          5,892,514       1,567,483          36,349
                                                                ------------    ------------    ------------
Income (loss) from discontinued operations (including gain
  (loss) on sale of properties)                                 $ 13,484,294    $ (1,715,725)   $ (2,533,452)
                                                                ============    ============    ============

Income (loss) - limited partners from discontinued operations
  (including gain (loss) on sale of properties)                 $ 13,349,451    $ (1,698,568)   $ (2,508,118)
                                                                ============    ============    ============

Number of BACs outstanding                                            72,896          72,896          72,896
                                                                ============    ============    ============

Income (loss) discontinued operations (including gain (loss)
  on sale of properties) per BAC                                $     183.13    $     (23.30)   $     (34.41)
                                                                ============    ============    ============

* Reclassified for comparative purposes
<CAPTION>
                                                                           Years Ended March 31,
                                                                --------------------------------------------
                                                                    2007            2006*           2005*
                                                                ------------    ------------    ------------
<S>                                                             <C>             <C>             <C>
Cash flows from discontinued operations:
Net cash (used in) provided by operating activities             $ (1,812,549)   $ (2,819,099)   $    658,572
Net cash provided by (used in) investing activities             $ 38,611,008    $  8,225,569    $   (417,127)
Net cash used in financing activities                           $(23,405,875)   $ (4,999,403)   $   (899,072)
</TABLE>

* Reclassified for comparative purposes.

                                       64
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          MARCH 31, 2007, 2006 and 2005


NOTE 12 - Selected Quarterly Financial Data (Unaudited)

The following table summarizes the Partnership's quarterly results of operations
for the years  ended  March 31,  2007 and 2006.  The  fluctuations  between  the
quarters  are  primarily  due to the sales and  classification  as  discontinued
operations of Local Partnerships (see Notes 9 and 11).
<TABLE>
<CAPTION>
                                                                             Quarter Ended
                                                        --------------------------------------------------------

                                                         June 30,     September 30,   December 31,    March 31,
                    OPERATIONS                             2006*          2006*          2006*          2007
-----------------------------------------------------   -----------    -----------    -----------    -----------
<S>                                                     <C>            <C>            <C>            <C>
Revenues                                                $ 1,537,669    $ 1,487,237    $ 1,596,172    $ 1,905,690

Total expenses                                           (2,031,361)    (2,123,867)    (1,972,088)    (2,064,381)
                                                        -----------    -----------    -----------    -----------

Loss from continuing operations before minority
   interest                                                (493,692)      (636,630)      (375,916)      (158,691)

Minority interest in loss of subsidiaries from
   operations                                                 3,067          5,767          2,951          1,011
                                                        -----------    -----------    -----------    -----------

Loss from continuing operations                            (490,625)      (630,863)      (372,965)      (157,680)

(Loss) income from discontinued operations (including
   minority interest)                                    (1,404,567)     6,371,877      5,908,649      2,608,335
                                                        -----------    -----------    -----------    -----------

Net (loss) income                                       $(1,895,192)   $ 5,741,014    $ 5,535,684    $ 2,450,655
                                                        ===========    ===========    ===========    ===========

Net (loss) income - limited partnership                 $(1,876,240)   $ 5,683,604    $ 5,480,327    $ 2,426,148
                                                        ===========    ===========    ===========    ===========

Loss per weighted average BAC from operations           $     (6.66)   $     (8.57)   $     (5.07)   $     (2.13)

(Loss) income per weighted average BAC from
   discontinued operations                                   (19.08)         86.54          80.25          35.42
                                                        -----------    -----------    -----------    -----------

Net (loss) income per weighted average BAC              $    (25.74)   $     77.97    $     75.18    $     33.29
                                                        ===========    ===========    ===========    ===========
<CAPTION>


                                                                             Quarter Ended
                                                        --------------------------------------------------------

                                                         June 30,     September 30,   December 31,    March 31,
                    OPERATIONS                             2005*          2005*          2005*          2006*
-----------------------------------------------------   -----------    -----------    -----------    -----------
<S>                                                     <C>            <C>            <C>            <C>
Revenues                                                $ 1,592,216    $ 1,515,981    $ 1,524,271    $ 1,801,432

Total expenses                                           (2,101,823)    (2,265,635)    (2,109,960)    (2,045,981)
                                                        -----------    -----------    -----------    -----------

Loss from continuing operations before minority
   interest                                                (509,607)      (749,654)      (585,689)      (244,549)

Minority interest in loss of subsidiaries from
   operations                                                 3,446          6,164          2,939            631
                                                        -----------    -----------    -----------    -----------

Loss from continuing operations                            (506,161)      (743,490)      (582,750)      (243,918)

(Loss) income from discontinued operations (including
   minority interest)                                    (1,112,811)      (357,129)      (408,571)       162,786
                                                        -----------    -----------    -----------    -----------

Net loss                                                $(1,618,972)   $(1,100,619)   $  (991,321)   $   (81,132)
                                                        ===========    ===========    ===========    ===========

Net loss - limited partnership                          $(1,602,782)   $(1,089,613)   $  (981,408)   $   (80,321)
                                                        ===========    ===========    ===========    ===========

Loss per weighted average BAC from operations           $     (6.88)   $    (10.10)   $     (7.91)   $     (3.31)

(Loss) income per weighted average BAC from
   discontinued operations                                   (15.11)         (4.85)         (5.55)          2.21
                                                        -----------    -----------    -----------    -----------

Net loss per weighted average BAC                       $    (21.99)   $    (14.95)   $    (13.46)   $     (1.10)
                                                        ===========    ===========    ===========    ===========
</TABLE>

* Reclassified for comparative purposes.

                                       65
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          MARCH 31, 2007, 2006 and 2005


NOTE 13 - Subsequent Events

On May 3, 2007, the  Partnership's  limited  partnership  interest in 220 Cooper
Street L.P.  ("Cooper Street") was sold to the Local General Partner for a sales
price of $50,000.  The Partnership  received  proceeds of $50,000 from the sale.
Because Cooper Street was sold to a related party of the Local Partnership,  the
sale resulted in a non-cash contribution to the Local Partnership from the Local
General  Partner of  approximately  $266,000.  Such  contribution  flows through
minority  interest as a result of the  write-off of the basis in the property of
approximately  $216,000 and the $50,000 cash received from the sale,  which will
be recognized on the Partnership's Quarterly Report on Form 10-Q for the quarter
ended June 30, 2007. The sale resulted in the liquidation of Cooper Street.

On April 30,  2007,  Brookwood  Associates,  Ltd  ("Brookwood")  entered  into a
purchase and sale  agreement  to sell its  property  and the related  assets and
liabilities  to an  unaffiliated  third party  purchaser for a purchase price of
$1,475,000. The sales documents have been executed and the initial deposit funds
are being held in escrow.  The  closing is  expected  to occur in June 2007.  No
assurance  can be given that the sale will  actually  occur.  As of December 31,
2006,   Brookwood  had  property  and  equipment,   at  cost,  of  approximately
$1,689,000, accumulated depreciation of approximately $666,000 and mortgage debt
of approximately $1,234,000.

On April 30,  2007,  Shadowood  Apartments,  Ltd.  ("Shadowood")  entered into a
purchase and sale  agreement  to sell its  property  and the related  assets and
liabilities  to an  unaffiliated  third party  purchaser for a purchase price of
$809,918.  The sales  documents have been executed and the initial deposit funds
are being held in escrow.  The  closing is  expected  to occur in June 2007.  No
assurance  can be given that the sale will  actually  occur.  As of December 31,
2006, Shadowood had property and equipment,  at cost, of approximately $955,000,
accumulated   depreciation  of  approximately  $373,000  and  mortgage  debt  of
approximately $726,000.

On April 30, 2007,  Heflin Hills Apartments L.P. ("Heflin Hills") entered into a
purchase and sale  agreement  to sell its  property  and the related  assets and
liabilities  to an  unaffiliated  third party  purchaser for a purchase price of
$865,000.  The sales  documents have been executed and the initial deposit funds
are being held in escrow.  The  closing is  expected  to occur in June 2007.  No
assurance  can be given that the sale will  actually  occur.  As of December 31,
2006,  Heflin  Hills had  property  and  equipment,  at cost,  of  approximately
$974,000,  accumulated  depreciation of approximately $384,000 and mortgage debt
of approximately $725,000.

On April 30, 2007, Hidden Valley Apartments, Ltd. ("Hidden Valley") entered into
a purchase and sale  agreement  to sell its property and the related  assets and
liabilities  to an  unaffiliated  third party  purchaser for a purchase price of
$1,400,000. The sales documents have been executed and the initial deposit funds
are being held in escrow.  The  closing is  expected  to occur in June 2007.  No
assurance  can be given that the sale will  actually  occur.  As of December 31,
2006,  Hidden  Valley had  property and  equipment,  at cost,  of  approximately
$1,862,000, accumulated depreciation of approximately $722,000 and mortgage debt
of approximately $1,176,000.

On April 30, 2007,  West Hill  Apartments,  L.P.  ("West  Hill")  entered into a
purchase and sale  agreement  to sell its  property  and the related  assets and
liabilities  to an  unaffiliated  third party  purchaser for a purchase price of
$861,688.  The sales  documents have been executed and the initial deposit funds
are being held in escrow.  The  closing is  expected  to occur in June 2007.  No
assurance  can be given that the sale will  actually  occur.  As of December 31,
2006,  West  Hill  had  property  and  equipment,   at  cost,  of  approximately
$1,060,000, accumulated depreciation of approximately $400,000 and mortgage debt
of approximately $749,000.

On April 30, 2007, Windsor Place, L.P.  ("Windsor")  entered into a purchase and
sale agreement to sell its property and the related assets and liabilities to an
unaffiliated  third party purchaser for a purchase price of $896,688.  The sales
documents  have been  executed and the initial  deposit  funds are being held in
escrow. The closing is expected to occur in June 2007. No assurance can be given
that the sale will actually occur. As of December 31, 2006, Windsor had property
and equipment, at cost, of approximately $1,016,000, accumulated depreciation of
approximately $395,000 and mortgage debt of approximately $747,000.

                                       66
<PAGE>

Item  9.  Changes  in and  Disagreements  with  Accountants  on  Accounting  and
Financial Disclosure

None

Item 9A.  Controls and Procedures

(a)  EVALUATION  OF  DISCLOSURE  CONTROLS AND  PROCEDURES.  The Chief  Executive
Officer and Chief Financial Officer of Freedom  Associates L.P. and Freedom G.P.
Inc., the general partners of the Partnership,  have evaluated the effectiveness
of the Partnership's disclosure controls and procedures (as such term is defined
in Rules 13a-15(e) and 15d-15(e)  under the Securities  Exchange Act of 1934, as
amended  ("Exchange Act") as of the end of the period covered by this report. In
designing and evaluating our disclosure controls and procedures,  our management
recognized  that any controls and  procedures,  no matter how well  designed and
operated,  can provide only reasonable  assurance of achieving their objectives,
and  our  management   necessarily   applied  its  judgment  in  evaluating  the
cost-benefit  relationship of possible  controls and  procedures.  Based on this
evaluation,  the Chief Executive  Officer and Chief Financial Officer of Freedom
Associates L.P. and Freedom G.P. Inc., the general  partners of the Partnership,
concluded that, as of the period covered by this report, our disclosure controls
and procedures were (1) designed to ensure that material information relating to
us,  including  our  consolidated  subsidiaries,  is  made  known  to the  Chief
Executive  Officer and Chief  Financial  Officer of Freedom  Associates L.P. and
Freedom G.P. Inc.,  the general  partners of the  Partnership,  by others within
those  entities,  particularly  during the period in which this report was being
prepared and (2)  effective,  in that they  provide  reasonable  assurance  that
information  required  to be  disclosed  by us in the  reports we file or submit
under  the  Securities  Exchange  Act is  recorded,  processed,  summarized  and
reported within the time periods specified in the SEC's rules and forms.

(b) CHANGES IN INTERNAL CONTROLS OVER FINANCIAL  REPORTING.  There have not been
any changes in the  Partnership's  internal  control  over  financial  reporting
during  the  fiscal  year to which  this  report  relates  that have  materially
affected,  or are  reasonably  likely to materially  affect,  the  Partnership's
internal control over financial reporting.

Item 9B.  Other Information

None.

                                       67
<PAGE>

                                    PART III


Item 10. Directors and Executive Officers and Corporate Governance

The  Partnership  has no  directors  or executive  officers.  The  Partnership's
affairs are managed and  controlled  by the General  Partners.  On November  25,
1997, an affiliate of the Related General Partner purchased 100% of the stock of
the Freedom General Partner.  Prior to such purchase the Freedom General Partner
was an affiliate of Lehman Brothers.  The Partnership has not adopted a separate
code of ethics because the Partnership  has no directors or executive  officers.
However, the ultimate parent of the General Partners, Centerline Holding Company
("Centerline")  (which had been  known as  CharterMac  until  April  2007),  has
adopted a code of ethics (see http://www.centerline.com).

On March 15, 2007,  Centerline  announced  the  retirement  of Alan P. Hirmes as
Chief Financial  Officer of Centerline.  Upon his  retirement,  he also resigned
from his  position as Director,  President,  Chief  Executive  Officer and Chief
Financial  Officer  of the  general  partner  of the  Related  General  Partner.
Centerline  has named  Robert L. Levy as Chief  Financial  Officer and Andrew J.
Weil as Chief Executive Officer to replace Mr. Hirmes.

Certain  information  concerning the directors and executive officers of each of
the General Partners is set forth below.

The Related General Partner
---------------------------

Related Freedom Associates Inc., ("RFAI") is the sole general partner of Related
Freedom Associates L.P.

             Name                         Position
             -----------------            ----------------------------------

             Robert L. Levy               Chief Financial Officer

             Andrew J. Weil               President, Chief Executive Officer

             Marc D. Schnitzer            Senior Vice President

             Glenn F. Hopps               Treasurer


ROBERT L. LEVY, 41, is the Chief  Financial  Officer of Centerline.  Mr. Levy is
also the  Chief  Financial  Officer  of  American  Mortgage  Acceptance  Company
("AMAC"), a publicly traded real estate investment trust managed by an affiliate
of  Centerline.  Mr. Levy is responsible  for overseeing the Corporate  Finance,
Capital Markets,  Accounting,  Budgeting, Tax and Treasury departments. Mr. Levy
joined  Centerline's  predecessor in November of 2001 as the Director of Capital
Markets.  From 1998  through  2001,  Mr. Levy was a Vice  President  in the Real
Estate Equity Research and Investment Banking Departments at Robertson Stephens,
an  investment  banking  firm in San  Francisco.  Prior  to 1998,  Mr.  Levy was
employed by Prudential  Securities in the Real Estate Equity  Research Group and
at Prudential  Realty Group,  the real estate  investment  arm of the Prudential
Insurance Company.  He received his Masters in Business  Administration from the
Leonard N. Stern School of Business at New York  University  and his Bachelor of
Arts from Northwestern University.

ANDREW J. WEIL, 36, is an Executive Managing Director of Centerline,  and is the
Head of the Affordable Housing Group. Mr. Weil is responsible for overseeing the
day to day operations of the Affordable Housing Group, including the acquisition
of  properties  with  Low-Income  Housing Tax Credits  and the  origination  and
structuring of institutional funds. Prior to joining Centerline's predecessor in
January  1994,  Mr.  Weil was a Financial  Analyst  for the  Heights  Management
Company,  where he  specialized  in the  analysis of potential  investments  and
property management. Mr. Weil received a Bachelor of Science degree in Economics
with a  concentration  in Finance form the Wharton  School of the  University of
Pennsylvania.

MARC D. SCHNITZER,  46, is responsible both for financial restructurings of real
estate   properties  and  directing   Centerline's   acquisition  of  properties
generating  Tax  Credits.   Mr.   Schnitzer   received  a  Masters  of  Business
Administration  from The Wharton  School of the  University of  Pennsylvania  in
December 1987 before  joining  Centerline in January 1988.  From 1983 to January
1986, he was a financial  analyst for the First Boston  Corporation in New York.
Mr.  Schnitzer  graduated summa cum laude with a Bachelor of Science in Business
Administration  from the School of Management at Boston  University in May 1983.
In  March  2006,  Mr.  Schnitzer  was  appointed  Chief  Executive   Officer  of
Centerline. Mr. Schnitzer also serves on the Board of Trustees of Centerline and
AMAC.

GLENN F. HOPPS, 44, joined Centerline in December,  1990, and prior to that date
was  employed by Marks Shron & Company and  Weissbarth,  Altman and  Michaelson,
certified public accountants. Mr. Hopps graduated from New York State University
at Albany with a Bachelor of Science Degree in Accounting.

                                       68
<PAGE>

The Freedom General Partner
---------------------------

The officers and directors of the Freedom General Partner are as follows:

       Name                            Position
       -----------------               ----------------------------------

       Robert L. Levy                  Chief Financial Officer

       Andrew J. Weil                  President, Chief Executive Officer

       Marc D. Schnitzer               Executive Vice President

       Glenn F. Hopps                  Treasurer


Biographical information with respect to Messrs. Levy, Weil, Schnitzer and Hopps
is set forth above.

Item 11. Executive Compensation

The  Partnership has no officers or directors.  The Partnership  does not pay or
accrue  any fees,  salaries  or other  forms of  compensation  to  directors  or
officers of the General Partners for their services. However, under the terms of
the  Partnership  Agreement,  the  General  Partners  and their  affiliates  are
entitled  to receive  compensation  from the  Partnership  in  consideration  of
certain services rendered to the Partnership by such parties.  In addition,  the
General  Partners  collectively  hold a 1% interest in all  profits,  losses and
distributions attributable to operations and a subordinated 15% interest in such
items attributable to sales and refinancings.  Certain directors and officers of
the General  Partners  receive  compensation  from the General Partner and their
affiliates  for services  performed for various  affiliated  entities  which may
include services  performed for the Partnership.  The maximum annual partnership
management fee paid to the General Partner is 0.5% of invested assets.  See Note
7 to the Financial  Statements in Item 8 above, which is incorporated  herein by
reference.

Tabular information concerning salaries, bonuses and other types of compensation
payable to executive  officers has not been included in this annual  report.  As
noted  above,  the  Partnership  has  no  executive  officers.   The  levels  of
compensation  payable to the General Partners and/or their affiliates is limited
by the terms of the Partnership  Agreement and may not be increased therefrom on
a discretionary basis.

Item 12.  Security  Ownership of Certain  Beneficial  Owners and  Management and
Related Stockholder Matters
<TABLE>
<CAPTION>
                               Name and Address of     Amount and Nature of
     Title of Class            Beneficial Ownership    Beneficial Ownership     Percentage of Class
--------------------------    ---------------------    --------------------    --------------------
<S>                           <C>                      <C>                               <C>
General Partnership           Related Freedom          $1,000 capital                    50%
Interest in the Partnership   Associates L.P.          contribution -
                              625 Madison Avenue       directly owned
                              New York, NY 10022

General Partnership           Freedom GP Inc.          $1,000 capital                    50%
Interest in the Partnership   625 Madison Avenue       contribution -
                              New York, NY 10022       directly owned
</TABLE>

Freedom SLP L.P., a limited  partnership  whose general partners are the General
Partners of the  Partnership  and which acts as the special  limited  partner of
each  Local  Partnership,  has  either  a .01%  or 1%  interest  in  each  Local
Partnership.

Except as set forth below, no person (other than the Assignor  Limited  Partner)
was  known by the  Partnership  to be the  beneficial  owner of more  than  five
percent of the limited partnership  interests in the Partnership and/or BACs and
neither the General Partners nor any director or officer of the General Partners
owns any Limited Partnership Interests or BACs.
<TABLE>
<CAPTION>
                                            Amount and Nature of   Percentage
 Name of Beneficial Owner (1)               Beneficial Ownership    of Class
-----------------------------------------   --------------------   -----------
<S>                                         <C>                         <C>
Lehigh Tax Credit Partners, Inc.            8,375.66(2) (3)             11.5%
J. Michael Fried                            8,375.66(2) (3) (4)         11.5%
Alan P. Hirmes                              8,375.66(2) (3) (4)         11.5%
Stuart J. Boesky                            8,375.66(2) (3) (4)         11.5%
Marc D. Schnitzer                                   -                      -
Robert L. Levy                                      -                      -
Andrew J. Weil                                      -                      -
Glenn F. Hopps                                      -                      -
All directors and executive officers
  of RFAI and The Freedom General Partner
  as a group (six persons)                  8,375.66(2) (3) (4)         11.5%
</TABLE>

(1) The address for each of the persons in the table is 625 Madison Avenue,  New
York, New York 10022.

(2) As set forth in  schedule  13D filed by the  Partnership,  Lehigh Tax Credit
L.L.C.  ("Lehigh") and Lehigh Tax Credit Partners,  Inc. (the "Managing Member")
on  October  24,  1997  with  the  Securities  and  Exchange   Commission   (the

                                       69
<PAGE>

"Commission") and pursuant to a letter agreement dated August 26, 1997 among the
Partnership, Lehigh and Related Freedom Associates L.P. ("RFA") (the "Standstill
Agreement"),  Lehigh  agreed  that,  prior to August 26,  2007 (the  "Standstill
Expiration Date"), it will not and it will cause certain  affiliates  (including
Lehigh Tax Credit Partners II, LLC ("Lehigh II")) not to (i) acquire, attempt to
acquire or make a proposal to acquire,  directly  or  indirectly,  more than 45%
(including BACs acquired through all other means) of the outstanding  BACs, (ii)
seek  to  propose  to  enter   into,   directly  or   indirectly,   any  merger,
consolidation, business combination, sale or acquisition of assets, liquidation,
dissolution or other similar transaction involving the Partnership,  (iii) make,
or in any way  participate,  directly or indirectly,  in any  "solicitation"  of
"proxies"  or  "consents"  (as such  terms  are used in the  proxy  rules of the
Commission) to vote any voting securities of the Partnership, (iv) form, join or
otherwise  participate in a "group"  (within the meaning of Section  13(d)(3) of
the Exchange  Act) with  respect to any voting  securities  of the  Partnership,
except  that those  affiliates  bound by the  Standstill  Agreement  will not be
deemed to have  violated it and formed a "group"  solely by acting in accordance
with the  Standstill  Agreement,  (v) disclose in writing to any third party any
intention,  plan or  arrangement  inconsistent  with the terms of the Standstill
Agreement,  or (vi) loan money to,  advise,  assist or  encourage  any person in
connection  with  any  action  inconsistent  with the  terms  of the  Standstill
Agreement. In addition,  Lehigh agreed that until the Standstill Expiration Date
it will not sell any BACs acquired by it unless the buyer of such BACs agrees to
be  bound  by the  Standstill  Agreement;  provided,  however,  Lehigh  may make
transfers  in the  secondary  market  to any  purchaser  which  represents  that
following  such  sale it will  not own  three  percent  (3%) or more of the BACs
outstanding.  By the terms of the  Standstill  Agreement,  Lehigh also agreed to
vote its BACs in the same  manner as a  majority  of all  voting  BACs  holders;
provided,  however,  Lehigh is entitled to vote its BACs as it  determines  with
regard to any proposal (i) to remove RFA as a general partner of the Partnership
or  (ii)  concerning  the  reduction  of any  fees,  profits,  distributions  or
allocations for the benefit of RFA or its affiliates.

(3) As of May 8, 2007,  Lehigh held  4,192.83  BACs and Lehigh II held  4,182.83
BACs which constitutes approximately 11.5% of the outstanding BACs owned.

(4) Each such party serves as a director and  executive  officer of the Managing
Member and owns an equity interest therein,  except J. Michael Fried,  Stuart J.
Boesky and Alan P. Hirmes, who own only an economic interest.

Item 13. Certain Relationships and Related Transactions; Director Independence

The  Partnership  has and will continue to have certain  relationships  with the
General  Partners  and  their  affiliates,  as  discussed  in Item 11  which  is
incorporated  herein by reference  thereto.  However,  there have been no direct
financial transactions between the Partnership and the directors and officers of
the General Partners.

Item 14. Principal Accountant Fees and Services

Audit Fees
----------
The aggregate fees by Friedman LLP and its affiliates for professional  services
rendered  for the  audit  of the  Partnership's  annual  consolidated  financial
statements  for the years  ended  March 31, 2007 and 2006 and for the reviews of
the consolidated  financial  statements included in the Partnership's  Quarterly
Reports on Form 10-Q for those years were $70,000 and $163,500, respectively.

Audit Related Fees
------------------
None

Tax Fees
--------
The aggregate fees by Weiser LLP and its affiliates  for  professional  services
rendered for the  preparation  of the  Partnership's  annual tax returns for the
years ended December 31, 2006 and 2005 were $8,900 and $8,700, respectively.

All Other Fees
--------------
None

The Partnership is not required to have, and does not have, a stand-alone  audit
committee.

                                       70
<PAGE>

                                     PART IV


Item 15. Exhibits and Consolidated Financial Statement Schedules
                                                                      Sequential
                                                                         Page
                                                                      ----------

(a) 1.   Consolidated Financial Statements
         ---------------------------------

         Report of Independent Registered Public Accounting Firm          19

         Consolidated Balance Sheets as of March 31, 2007 and 2006        47

         Consolidated Statements of Operations for the years ended
           March 31, 2007, 2006 and 2005                                  48

         Consolidated Statements of Changes in Partners' Capital
           (Deficit) for the years ended March 31, 2007, 2006 and
           2005                                                           49

         Consolidated Statements of Cash Flows for the years ended
           March 31, 2007, 2006 and 2005                                  50

         Notes to Consolidated Financial Statements                       51

(a) 2.   Consolidated Financial Statement Schedules
         ------------------------------------------

         Report of Independent Registered Public Accounting Firm          78

         Schedule I - Condensed Financial Information of Registrant       79

         Schedule III - Real Estate and Accumulated Depreciation          82

         All other  schedules have been omitted because they are not
         required or because the required information is contained
         in the  financial statements or notes thereto.

(a)3.    Exhibits
         --------

(3A)     The  Partnership's   Amended  and  Restated   Agreement  of
         Limited Partnership,  incorporated  herein as an exhibit by
         reference  to Exhibit A to the Partnership's Prospectus,
         dated February 9, 1990, as supplemented  by supplements
         thereto dated December 7, 1990, May 10, 1991, July 10, 1991
         and July 23, 1991 (as so  supplemented, the "Prospectus"),
         filed with the Securities and Exchange Commission on July 30,
         1992, as part of Post-Effective Amendment No. 6 to the
         Partnership's registration statement on Form S-11, File No.
         33-30859 ("Post-Effective Amendment No. 6")

(3B)     The Partnership's Certificate of Limited Partnership,  as
         filed with Secretary  of State of the State of  Delaware
         on August 28, 1989, incorporated  herein as an exhibit by
         reference to Exhibit (3C) to the Partnership's registration
         statement on Form S-11,  File No. 33-30859,  as filed with
         the Securities and Exchange Commission on September 1, 1989
         (the "Initial S-11")

(10A)    Form of Subscription Agreement, incorporated herein as an
         exhibit by reference to  Exhibit B to the Prospectus as
         filed as part of Post-Effective Amendment No. 6

(10B)    Form of Purchase and Sale Agreement pertaining to the
         Partnership's acquisition of Local Partnership Interests,
         incorporated herein as an exhibit by reference to Exhibit
         (10C) to the Initial S-11

(10C)    Form of Amended and  Restated  Agreement of Limited
         Partnership of Local  Partnerships,  incorporated herein
         as an exhibit by reference to Exhibit (10D) to Pre-Effective
         Amendment No. 1 to the Partnership's registration statement
         on Form S-11, File No. 33-30859, as filed with the Securities
         and Exchange Commission on December 21, 1989

(21)     Subsidiaries of the Registrant                                   72

(31.1)   Certification Pursuant to Rule 13a-14(a) or Rule 15d-14(a)       75

(31.2)   Certification Pursuant to Rule 13a-14(a) or Rule 15d-14(a)       76

(32.1)   Certification  Pursuant to Rule  13a-14(b) or Rule 15d-14(b)
         and Section 1350 of Title 18 of the United States Coded
         (18 U.S.C. 1350)                                                 77

                                       71
<PAGE>

Item 15. Exhibits and Consolidated Financial Statement Schedules (continued)

                                                                    Jurisdiction
                                                                         of
                                                                    Organization
                                                                    ------------

(c)      Subsidiaries of the Registrant (Exhibit 21)
         -------------------------------------------

         Twin Trees Apartments                                            UT
         Bennion Park Apartments (Mulberry)                               UT
         Hunters Chase Apartments                                         AL
         Wilshire Park Apartments                                         AL
         Bethel Park Apartments                                           OH
         Zebulon Park Apartments                                          OH
         Tivoli Place Apartments                                          TN
         Northwood Apartments                                             FL
         Oxford Trace Apartments                                          SC
         Ivanhoe Apartments Limited Partnership                           UT
         Washington Brooklyn Limited Partnership                          NY
         C.H. Development Group Associates (Manhattan B)                  NY
         Davidson Court Limited Partnership                               NY
         Magnolia Mews Limited Partnership                                PA
         CLM Equities Limited Partnership (Morris Avenue)                 NY
         Victoria Manor Associates                                        CA
         Ogontz Hall Investors                                            PA
         Eagle Ridge Limited Partnership                                  WI
         Nelson Anderson Affordable Housing Limited Partnership           NY
         Conifer Irondequoit Associates (Abraham Lincoln)                 NY
         Middletown Associates (Wilson Street)                            PA
         Lauderdale Lakes Associates, Ltd.                                FL
         Flipper Temple Associates Limited Partnership                    GA
         220 Cooper Street Associates Limited Partnership                 NJ
         Pecan Creek                                                      OK
         363 Grand Vendome Associates Limited Partnership                 NY
         New Augusta Ltd. (Rainer Villas)                                 AL
         Pine Shadow Apartments                                           MS
         Windsor Place Apartments                                         AL
         Brookwood Apartments, Ltd.                                       AL
         Heflin Hills Apartments, Ltd.                                    AL
         Shadowood Apts., Ltd.                                            AL
         Brittany Associates, Ltd.                                        MS
         Hidden Valley Apartments                                         AL
         Westbrook Square Limited Partnership                             MS
         Warsaw Elderly Housing Ltd. (Royal Pines Apts.)                  KY
         West Hill Square Apts., Ltd.                                     AL
         Elmwood Associates                                               MS
         Harmony Gate Associates                                          CA

                                       72
<PAGE>

                                   SIGNATURES
                                   ----------

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  the  registrant  has duly  caused  this report to be signed on its
behalf by the undersigned, thereunto duly authorized.


                          FREEDOM TAX CREDIT PLUS L.P.


                                By:  RELATED FREEDOM ASSOCIATES L.P.
                                     a general partner


                                     By:  RELATED FREEDOM ASSOCIATES INC.,
                                          a general partner



Date: June 25, 2007
      -------------
                                          By: /s/ Robert L. Levy
                                              ------------------
                                              Robert L. Levy
                                              Chief Financial Officer



Date: June 25, 2007
      -------------
                                          By: /s/ Andrew J. Weil
                                              ------------------
                                              Andrew J. Weil
                                              President, Chief Executive Officer



                                     By:  FREEDOM GP INC.
                                          a general partner



Date: June 25, 2007
      -------------
                                          By: /s/ Robert L. Levy
                                              ------------------
                                              Robert L. Levy
                                              Chief Financial Officer



Date: June 25, 2007
      -------------
                                          By: /s/ Andrew J. Weil
                                              ------------------
                                              Andrew J. Weil
                                              President, Chief Executive Officer

                                       73
<PAGE>

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934, the report has been signed below by the following persons on behalf
by the registrant and in the capacities and on the dates indicated:


     Signature                        Title                           Date
------------------   ----------------------------------------   ---------------


/s/ Robert L. Levy   Chief Financial Officer (Principal
------------------   Financial Officer) of Related Freedom       June 25, 2007
Robert L. Levy       Associates, Inc. and Freedom GP Inc.        -------------


                     President and Chief Executive Officer
/s/ Andrew J. Weil   (Principal Executive Officer) of            June 25, 2007
------------------   Related Freedom Associates, Inc. and        -------------
Andrew J. Weil       Freedom GP Inc.



/s/ Glenn F. Hopps   Treasurer (Principal Accounting Officer)    June 25, 2007
------------------   of Related Freedom Associates, Inc.         -------------
Glenn F. Hopps


                                       74
<PAGE>

                                                                    Exhibit 31.1



                         CERTIFICATION PURSUANT TO RULE
                           13a-14(a) OR RULE 15d-14(a)


I, Robert L. Levy, certify that:

     1.  I have  reviewed  this annual  report on Form 10-K for the period ended
         March 31, 2007 of Freedom Tax Credit Plus L.P.;

     2.  Based  on my  knowledge,  this  report  does  not  contain  any  untrue
         statement of a material fact or omit to state a material fact necessary
         to make the statements made, in light of the circumstances  under which
         such  statements  were made, not misleading  with respect to the period
         covered by this annual report;

     3.  Based on my knowledge, the consolidated financial statements, and other
         financial  information  included in this report,  fairly present in all
         material  respects the  consolidated  financial  condition,  results of
         operations and cash flows of the registrant as of, and for, the periods
         presented in this report;

     4.  The  registrant's  other  certifying  officer and I are responsible for
         establishing  and  maintaining  disclosure  controls and procedures (as
         defined in Exchange Act Rules  13a-15(e)  and  15d-15(e))  and internal
         control  over  financial  reporting  (as defined in Exchange  Act Rules
         13a-15(f) and 15d-15(f)) for the registrant and have:

         a) designed such  disclosure  controls and  procedures,  or caused such
         disclosure   controls  and   procedures   to  be  designed   under  our
         supervision,  to  ensure  that  material  information  relating  to the
         registrant,  including its consolidated subsidiaries,  is made known to
         us by others within those entities,  particularly  during the period in
         which this report is being prepared;

         b) designed such internal control over financial  reporting,  or caused
         such internal control over financial reporting to be designed under our
         supervision,  to provide reasonable assurance regarding the reliability
         of financial reporting and the preparation of financial  statements for
         external  purposes in accordance  with  generally  accepted  accounting
         principles;

         c) evaluated the effectiveness of the registrant's  disclosure controls
         and procedures and presented in this report our  conclusions  about the
         effectiveness of the disclosure controls and procedures,  as of the end
         of the period covered by this report based on such evaluation; and

         d)  disclosed  in this report any change in the  registrant's  internal
         control over financial  reporting that occurred during the registrant's
         fourth fiscal  quarter that has materially  affected,  or is reasonably
         likely to materially  affect,  the  registrant's  internal control over
         financial reporting; and

     5.  The registrant's other certifying  officer and I have disclosed,  based
         on our most  recent  evaluation  of  internal  control  over  financial
         reporting,  to the registrant's auditors and the audit committee of the
         registrant's  board of directors (or persons  performing the equivalent
         functions):

         a) all significant  deficiencies and material  weaknesses in the design
         or operation of internal  control over  financial  reporting  which are
         reasonably  likely to  adversely  affect  the  registrant's  ability to
         record, process, summarize and report financial information; and

         b) any fraud,  whether or not  material,  that  involves  management or
         other  employees  who  have a  significant  role  in  the  registrant's
         internal control over financial reporting.



         Date: June 25, 2007
               -------------
                                                    By:  /s/ Robert L. Levy
                                                         ------------------
                                                         Robert L Levy
                                                         Chief Financial Officer


                                       75
<PAGE>


                                                                    Exhibit 31.2



                         CERTIFICATION PURSUANT TO RULE
                           13a-14(a) OR RULE 15d-14(a)


I, Andrew J Weil, certify that:

     1.  I have  reviewed  this annual  report on Form 10-K for the period ended
         March 31, 2007 of Freedom Tax Credit Plus L.P.;

     2.  Based  on my  knowledge,  this  report  does  not  contain  any  untrue
         statement of a material fact or omit to state a material fact necessary
         to make the statements made, in light of the circumstances  under which
         such  statements  were made, not misleading  with respect to the period
         covered by this annual report;

     3.  Based on my knowledge, the consolidated financial statements, and other
         financial  information  included in this report,  fairly present in all
         material  respects the  consolidated  financial  condition,  results of
         operations and cash flows of the registrant as of, and for, the periods
         presented in this report;

     4.  The  registrant's  other  certifying  officer and I are responsible for
         establishing  and  maintaining  disclosure  controls and procedures (as
         defined in Exchange Act Rules  13a-15(e)  and  15d-15(e))  and internal
         control  over  financial  reporting  (as defined in Exchange  Act Rules
         13a-15(f) and 15d-15(f)) for the registrant and have:

         a) designed such  disclosure  controls and  procedures,  or caused such
         disclosure   controls  and   procedures   to  be  designed   under  our
         supervision,  to  ensure  that  material  information  relating  to the
         registrant,  including its consolidated subsidiaries,  is made known to
         us by others within those entities,  particularly  during the period in
         which this report is being prepared;

         b) designed such internal control over financial  reporting,  or caused
         such internal control over financial reporting to be designed under our
         supervision,  to provide reasonable assurance regarding the reliability
         of financial reporting and the preparation of financial  statements for
         external  purposes in accordance  with  generally  accepted  accounting
         principles;

         c) evaluated the effectiveness of the registrant's  disclosure controls
         and procedures and presented in this report our  conclusions  about the
         effectiveness of the disclosure controls and procedures,  as of the end
         of the period covered by this report based on such evaluation; and

         d)  disclosed  in this report any change in the  registrant's  internal
         control over financial  reporting that occurred during the registrant's
         fourth fiscal  quarter that has materially  affected,  or is reasonably
         likely to materially  affect,  the  registrant's  internal control over
         financial reporting; and

     5.  The registrant's other certifying  officer and I have disclosed,  based
         on our most  recent  evaluation  of  internal  control  over  financial
         reporting,  to the registrant's auditors and the audit committee of the
         registrant's  board of directors (or persons  performing the equivalent
         functions):

         a) all significant  deficiencies and material  weaknesses in the design
         or operation of internal  control over  financial  reporting  which are
         reasonably  likely to  adversely  affect  the  registrant's  ability to
         record, process, summarize and report financial information; and

         b) any fraud,  whether or not  material,  that  involves  management or
         other  employees  who  have a  significant  role  in  the  registrant's
         internal control over financial reporting.



         Date: June 25, 2007
               -------------

                                                  By:  /s/ Andrew J. Weil
                                                       ------------------
                                                       Andrew J. Weil
                                                       Chief Executive Officer


                                       76
<PAGE>


                                                                    Exhibit 32.1



                             CERTIFICATION PURSUANT
                       TO RULE 13a-14(b) OR RULE 15d-14(b)
                          AND SECTION 1350 OF TITLE 18
                   OF THE UNITED STATES CODE (18 U.S.C. 1350)


In  connection  with the Annual  Report of Freedom  Tax Credit Plus L.P. on Form
10-K for the  period  ended  March 31,  2007 as filed  with the  Securities  and
Exchange Commission ("SEC") on the date hereof (the "Report"), I, Robert L. Levy
and I, Andrew J. Weil, certify,  pursuant to 18 U.S.C.  Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:


       (1) The Report fully complies with the  requirements  of section 13(a) or
15(d) of the Securities Exchange Act of 1934; and


       (2) The  information  contained  in the Report  fairly  presents,  in all
material  respects,  the  financial  condition  and result of  operations of the
registrant.

A signed  original of this  written  statement  required by Section 906 has been
provided to the  registrant and will be retained by the registrant and furnished
to the SEC or its staff upon request.



By:  /s/ Robert L. Levy                            By:  /s/ Andrew J. Weil
     ------------------                                 ------------------
     Robert L. Levy                                     Andrew J. Weil
     Chief Financial Officer                            Chief Executive Officer
     June 25, 2007                                      June 25, 2007


                                       77
<PAGE>


                     REPORT OF INDEPENDENT REGISTERED PUBLIC
                ACCOUNTING FIRM ON FINANCIAL STATEMENT SCHEDULES




To the Partners
Freedom Tax Credit Plus L.P. and Subsidiaries


Under date of June 18, 2007, we reported on the  consolidated  balance sheets of
Freedom Tax Credit Plus L.P. and Subsidiaries as of March 31, 2007 and 2006, and
the related consolidated statements of operations,  changes in partners' capital
(deficit)  and cash flows for each of the years in the  three-year  period ended
March 31, 2007.

In  connection  with our  audits of the  aforementioned  consolidated  financial
statements,  we have also audited supporting Schedule I as of March 31, 2007 and
2006 and for the years ended March 31, 2007,  2006 and 2005, and Schedule III as
of March 31, 2007 and for the years ended March 31, 2007,  2006 and 2005.  These
supporting schedules are the responsibility of the Partnerships' management. Our
responsibility  is to express an opinion on these schedules based on our audits.
In our opinion,  these schedules  present fairly,  when read in conjunction with
the related consolidated financial statements, the financial data required to be
set forth therein.










/s/ Friedman LLP


New York, New York
June 18, 2007

                                       78
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                                   SCHEDULE I
            CONDENSED SCHEDULE OF FINANCIAL INFORMATION OF REGISTRANT


Summarized   condensed  financial   information  of  registrant  (not  including
consolidated subsidiary partnerships)

                            CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
                                     ASSETS

                                                                             March 31,
                                                                    ---------------------------
                                                                        2007           2006
                                                                    ------------   ------------

<S>                                                                 <C>            <C>
Cash and cash equivalents                                           $  4,998,494   $  2,281,735
Investment in subsidiary partnerships, carried on an equity basis      4,084,185      3,090,682
                                                                    ------------   ------------

Total assets                                                        $  9,082,679   $  5,372,417
                                                                    ============   ============


                   LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)


Due to general partner and affiliates                               $  3,016,292   $  9,314,244
Accounts payable and other liabilities                                   145,099      1,969,046
                                                                    ------------   ------------

Total liabilities                                                      3,161,391     11,283,290
                                                                    ------------   ------------

Partners' capital (deficit)                                            5,921,288     (5,910,873)
                                                                    ------------   ------------

Total liabilities and partners' capital (deficit)                   $  9,082,679   $  5,372,417
                                                                    ============   ============
</TABLE>


Investments  in  subsidiary  partnerships  are recorded in  accordance  with the
equity method of accounting, wherein the investments are not reduced below zero.
Accordingly, partners' equity on the consolidated balance sheet will differ from
partners' equity shown above.

                                       79
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                                   SCHEDULE I
            CONDENSED SCHEDULE OF FINANCIAL INFORMATION OF REGISTRANT



                       CONDENSED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
                                                          Years Ended March 31,
                                              --------------------------------------------
                                                  2007            2006            2005
                                              ------------    ------------    ------------
<S>                                           <C>             <C>             <C>
Income

Other income                                  $    350,007    $    171,862    $     10,404
Loss on sale of properties                        (545,346)              0               0
                                              ------------    ------------    ------------

Total (loss) income                               (195,339)        171,862          10,404
                                              ------------    ------------    ------------

Expenses

Equity in losses of subsidiary partnerships    (13,126,658)      2,651,688       3,163,835
General and administrative                         416,597         238,053         115,972
General and administrative-related parties         682,561       1,074,165         950,235
                                              ------------    ------------    ------------

Total expenses                                 (12,027,500)      3,963,906       4,230,042
                                              ------------    ------------    ------------

Net income (loss)                             $ 11,832,161    $ (3,792,044)   $ (4,219,638)
                                              ============    ============    ============
</TABLE>

                                       80
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                                   SCHEDULE I
            CONDENSED SCHEDULE OF FINANCIAL INFORMATION OF REGISTRANT



                       CONDENSED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
                                                                       Years Ended March 31,
                                                            --------------------------------------------
                                                                2007            2006            2005
                                                            ------------    ------------    ------------
<S>                                                         <C>             <C>             <C>
Net income (loss)                                           $ 11,832,161    $ (3,792,044)   $ (4,219,638)
                                                            ------------    ------------    ------------

Adjustments to reconcile net loss to net cash provided by
   (used in) operating activities:

   Equity in (income) losses of subsidiary partnerships      (13,126,658)      2,651,688       3,163,835

   Loss on sale                                                  545,346          81,351               0

   Increase (decrease) in liabilities:

   Due to general partner and affiliates                      (6,297,952)        913,706         969,889

   Deferred revenue from sale of properties                            0       1,888,040               0

   Accounts payable and other liabilities                     (1,921,958)         26,756           9,958
                                                            ------------    ------------    ------------

   Total adjustments                                         (20,801,222)      5,561,541       4,143,682
                                                            ------------    ------------    ------------

Net cash (used in) provided by operating activities           (8,969,061)      1,769,497         (75,956)
                                                            ------------    ------------    ------------

Cash flows from investing activities:

Distributions from subsidiaries                               11,349,453          24,060         138,247

Distributions                                                 (6,995,071)              0               0

Contributions - write-off of partnership management
   fees related to sold properties                             4,095,540               0               0

Contributions from related party sales                         3,235,898         406,907               0
                                                            ------------    ------------    ------------

Net cash provided by investing activities                     11,685,820         430,967         138,247
                                                            ------------    ------------    ------------

Net increase in cash and cash equivalents                      2,716,759       2,200,464          62,291

Cash and cash equivalents, beginning of year                   2,281,735          81,271          18,980
                                                            ------------    ------------    ------------

Cash and cash equivalents, end of year                      $  4,998,494    $  2,281,735    $     81,271
                                                            ============    ============    ============
</TABLE>

                                       81
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                                  SCHEDULE III
              SCHEDULE OF REAL ESTATE AND ACCUMULATED DEPRECIATION
                                 MARCH 31, 2007
<TABLE>
<CAPTION>
                                               Initial Cost to Partnership
                                              -----------------------------
                                                                                   Cost
                                                                                Capitalized
                                                                                  Reduced
                                                              Buildings and    Subsequent to
Description                   Encumbrances        Land         Improvements     Acquisition
--------------------------    ------------    ------------    -------------    -------------
<S>                           <C>             <C>             <C>              <C>
Parkside Townhouses
  York, PA (E)                $          0    $    263,231    $   4,439,564    $  (4,702,795)
Twin Trees
  Layton, UT (F)                         0         112,401        2,668,179       (2,569,089)
Bennion (Mulberry)
  Taylorsville, UT (F)                   0         258,000        4,934,447       (4,860,317)
Hunters Chase
  Madison, AL (F)                        0         411,100        5,616,330       (4,852,013)
Bethel Park
  Bethel, OH (F)                         0         141,320        5,365,882       (4,468,364)
Zebulon Park
  Owensville, OH (F)                     0         165,000        4,187,880       (3,593,655)
Tivoli Place
  Murphreesboro, TN (F)                  0         267,500        4,146,759       (3,887,845)
Northwood
  Jacksonville, FL (F)                   0         494,900        6,630,321       (6,284,146)
Oxford Trace
  Aiken, SC (F)                          0         162,000        1,725,512       (1,513,174)
Wilshire
  Huntsville, AL (F)                     0         178,497        4,014,281       (3,530,587)
Ivanhoe
  Salt Lake City, UT (E)                 0          41,000        1,136,915       (1,103,361)
Washington Avenue
  Brooklyn, NY (F)                       0          42,485        2,843,351       (2,809,797)
C.H. Development
  (Manhattan B)
  New York, NY (F)                       0               3        3,294,688       (3,261,134)
Davidson Court
  Staten Island, NY (E)                  0          96,892          773,052         (739,498)
Magnolia Mews
  Philadelphia, PA               1,477,243         200,000          668,007        2,433,150
Oaks Village
  Whiteville, NC (E)                     0          63,548        1,799,849          (63,548)
Greenfield Village
  Dunn, NC (E)                           0          78,296        1,806,126          (78,296)
Morris Avenue
  (CLM Equities)
  Bronx, NY (E)                          0               2        4,767,049       (4,733,495)
Victoria Manor
  Riverside, CA                  1,956,753         615,000        5,340,962         (153,198)
Ogontz Hallz
  Philadelphia, PA               2,165,494               0          328,846        3,462,022
Eagle Ridge
  Stoughton, WI (F)                      0         321,594        2,627,385       (2,593,831)
Nelson Anderson
  Bronx, NY (E)                          0               2        6,524,096       (6,490,542)
Conifer Irondequoit
  (Abraham Lincoln) (G)
  Irondequoit, NY                        0          20,000        5,407,108       (5,373,555)
Wilson Street Apts.
  (Middletown)
  Middletown, PA                 1,673,496          38,449                0        3,463,723
Lauderdale Lakes
  Lauderdale Lakes, FL (F)               0         873,973        3,976,744       (3,943,152)
Flipper Temple
  Atlanta, GA                    2,434,094          70,519        4,907,110          905,192
220 Cooper Street
  Camden, NJ                       912,867          41,000                0        3,689,099

<CAPTION>

                                                Gross Amount at which Carried at Close of Period
                                                ------------------------------------------------

                              Purchase Price
                              Adjustments (B)
                              Buildings and                      Buildings and
Description                    Improvements         Land          Improvements       Total (A)
--------------------------    --------------    -------------    -------------    --------------
<S>                           <C>               <C>              <C>              <C>
Parkside Townhouses
  York, PA (E)                $            0    $           0    $           0    $            0
Twin Trees
  Layton, UT (F)                     (47,642)               0                0                 0
Bennion (Mulberry)
  Taylorsville, UT (F)               (22,842)               0                0                 0
Hunters Chase
  Madison, AL (F)                   (713,028)               0                0                 0
Bethel Park
  Bethel, OH (F)                    (846,229)               0                0                 0
Zebulon Park
  Owensville, OH (F)                (542,936)               0                0                 0
Tivoli Place
  Murphreesboro, TN (F)             (207,625)               0                0                 0
Northwood
  Jacksonville, FL (F)              (294,886)               0                0                 0
Oxford Trace
  Aiken, SC (F)                     (161,049)               0                0                 0
Wilshire
  Huntsville, AL (F)                (432,405)               0                0                 0
Ivanhoe
  Salt Lake City, UT (E)                   0                0                0                 0
Washington Avenue
  Brooklyn, NY (F)                         0                0                0                 0
C.H. Development
  (Manhattan B)
  New York, NY (F)                         0                0                0                 0
Davidson Court
  Staten Island, NY (E)                    0                0                0                 0
Magnolia Mews
  Philadelphia, PA                         0          201,677        3,099,480         3,301,157
Oaks Village
  Whiteville, NC (E)                       0                0                0                 0
Greenfield Village
  Dunn, NC (E)                             0                0                0                 0
Morris Avenue
  (CLM Equities)
  Bronx, NY (E)                            0                0                0                 0
Victoria Manor
  Riverside, CA                            0          616,677        5,186,101         5,802,778
Ogontz Hallz
  Philadelphia, PA                         0            1,677        3,789,191         3,790,868
Eagle Ridge
  Stoughton, WI (F)                        0                0                0                 0
Nelson Anderson
  Bronx, NY (E)                            0                0                0                 0
Conifer Irondequoit
  (Abraham Lincoln) (G)
  Irondequoit, NY                          0                0                0                 0
Wilson Street Apts.
  (Middletown)
  Middletown, PA                           0           40,126        3,462,046         3,502,172
Lauderdale Lakes
  Lauderdale Lakes, FL (F)                 0                0                0                 0
Flipper Temple
  Atlanta, GA                              0           72,196        5,810,625         5,882,821
220 Cooper Street
  Camden, NJ                               0           42,677        3,687,422         3,730,099

<CAPTION>


                                                                                  Life on which
                                                                                 Depreciation in
                                                 Year of                          Latest Income
                              Accumulated      Construction        Date          Statements are
Description                   Depreciation       Renovation       Acquired       Computed (C)(D)
--------------------------    -------------    -------------    -------------    ---------------
<S>                           <C>                  <C>             <C>                <C>
Parkside Townhouses
  York, PA (E)                $           0        1989            Sept. 1990         27.5
Twin Trees
  Layton, UT (F)                          0        1989             Oct. 1990         27.5
Bennion (Mulberry)
  Taylorsville, UT (F)                    0        1989             Oct. 1990         27.5
Hunters Chase
  Madison, AL (F)                         0        1989             Oct. 1990         27.5
Bethel Park
  Bethel, OH (F)                          0        1989             Oct. 1990         27.5
Zebulon Park
  Owensville, OH (F)                      0        1989             Oct. 1990         27.5
Tivoli Place
  Murphreesboro, TN (F)                   0        1989             Oct. 1990         27.5
Northwood
  Jacksonville, FL (F)                    0        1989             Oct. 1990         27.5
Oxford Trace
  Aiken, SC (F)                           0        1989             Oct. 1990         27.5
Wilshire
  Huntsville, AL (F)                      0        1989             Oct. 1990         27.5
Ivanhoe
  Salt Lake City, UT (E)                  0        1991             Jan. 1991         27.5
Washington Avenue
  Brooklyn, NY (F)                        0        1991             Jan. 1991         27.5
C.H. Development
  (Manhattan B)
  New York, NY (F)                        0        1991             Jan. 1991         27.5
Davidson Court
  Staten Island, NY (E)                   0        1991             Mar. 1991         27.5
Magnolia Mews
  Philadelphia, PA                1,670,089        1991             Mar. 1991         27.5
Oaks Village
  Whiteville, NC (E)                      0        1991             Mar. 1991         27.5
Greenfield Village
  Dunn, NC (E)                            0        1991             Mar. 1991         27.5
Morris Avenue
  (CLM Equities)
  Bronx, NY (E)                           0        1991             Apr. 1991         27.5
Victoria Manor
  Riverside, CA                   2,881,427        1991             Apr. 1991         27.5
Ogontz Hallz
  Philadelphia, PA                2,077,218        1990             Apr. 1991         27.5
Eagle Ridge
  Stoughton, WI (F)                       0        1991              May 1991         27.5
Nelson Anderson
  Bronx, NY (E)                           0        1991             June 1991         27.5
Conifer Irondequoit
  (Abraham Lincoln) (G)
  Irondequoit, NY                         0        1991            Sept. 1991         27.5
Wilson Street Apts.
  (Middletown)
  Middletown, PA                  1,636,581        1991            Sept. 1991         27.5
Lauderdale Lakes
  Lauderdale Lakes, FL (F)                0        1991             Oct. 1991         40
Flipper Temple
  Atlanta, GA                     2,611,192        1991             Oct. 1991         27.5
220 Cooper Street
  Camden, NJ                      2,025,766        1991             Dec. 1991         27.5
</TABLE>


                                       82
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                                  SCHEDULE III
              SCHEDULE OF REAL ESTATE AND ACCUMULATED DEPRECIATION
                                 MARCH 31, 2007
                                  (continued)
<TABLE>
<CAPTION>
                                               Initial Cost to Partnership
                                              -----------------------------
                                                                                   Cost
                                                                                Capitalized
                                                                                  Reduced
                                                              Buildings and    Subsequent to
Description                   Encumbrances        Land         Improvements     Acquisition
--------------------------    ------------    ------------    -------------    -------------
<S>                           <C>             <C>             <C>              <C>
Vendome
  Brooklyn, NY                   2,544,309          12,000        4,867,584          220,536
Pecan Creek
  Tulsa, OK                        970,781          50,000        1,484,923          233,586
New Augusta Ltd.
  (Rainer Villas)
  New Augusta, AL                  695,604          15,000          939,681          141,079
Pine Shadow Apts.
  Waveland, MS                   1,610,199          74,550        2,117,989          208,141
Windsor Place Apts.
  Wedowee, AL                      747,105          40,000          904,888           74,792
Brookwood Apts.
  Foley, AL                      1,234,498          68,675        1,517,190          105,886
Heflin Hills Apts.
  Heflin, AL                       724,688          50,000          841,300           86,159
Shadowood Apts.
  Stevenson, AL                    726,458          27,000          898,800           31,951
Brittany Apartments
  DeKalb, MS                       672,820          20,000          843,592           81,334
Hidden Valley Apts.
  Brewton, AL                    1,176,289          68,000        1,637,840          159,016
Westbrook Square L.P.
  Carthage, MS                   1,002,123          40,000        1,254,957           76,079
Warsaw Elderly Housing Ltd.
  Warsaw, KY                     1,109,878          98,819        1,333,606           21,772
West Hill Square Apts.Ltd.
  Gordo, AL                        749,499          60,000          954,020           49,459
Elmwood Assoc.
  Picayune, MS                     691,943          81,500          829,183           70,376
Harmony Gate Assoc.
  Los Angeles, CA (G)                    0               0        9,757,807       (9,754,580)

Less discontinued operations             0      (3,991,744)     (88,443,325)      81,203,381
                              ------------    ------------    -------------    -------------

                              $ 25,276,141    $  1,670,512    $  31,670,478    $  15,356,761
                              ============    ============    =============    =============

<CAPTION>
                                                Gross Amount at which Carried at Close of Period
                                                ------------------------------------------------

                              Purchase Price
                              Adjustments (B)
                              Buildings and                      Buildings and
Description                    Improvements         Land          Improvements       Total (A)
--------------------------    --------------    -------------    -------------    --------------
<S>                           <C>               <C>              <C>              <C>
Vendome
  Brooklyn, NY                             0           13,677        5,086,443         5,100,120
Pecan Creek
  Tulsa, OK                                0           50,161        1,718,348         1,768,509
New Augusta Ltd.
  (Rainer Villas)
  New Augusta, AL                          0           15,161        1,080,599         1,095,760
Pine Shadow Apts.
  Waveland, MS                             0           74,711        2,325,969         2,400,680
Windsor Place Apts.
  Wedowee, AL                              0           40,161          979,519         1,019,680
Brookwood Apts.
  Foley, AL                                0           68,836        1,622,915         1,691,751
Heflin Hills Apts.
  Heflin, AL                               0           50,161          927,298           977,459
Shadowood Apts.
  Stevenson, AL                            0           27,161          930,590           957,751
Brittany Apartments
  DeKalb, MS                               0           20,161          924,765           944,926
Hidden Valley Apts.
  Brewton, AL                              0           68,161        1,796,695         1,864,856
Westbrook Square L.P.
  Carthage, MS                             0           40,161        1,330,875         1,371,036
Warsaw Elderly Housing Ltd.
  Warsaw, KY                               0           98,980        1,355,217         1,454,197
West Hill Square Apts.Ltd.
  Gordo, AL                                0           60,161        1,003,318         1,063,479
Elmwood Assoc.
  Picayune, MS                             0           81,502          896,150           977,652
Harmony Gate Assoc.
  Los Angeles, CA (G)                      0                0                0                 0

Less discontinued operations       3,268,642                0                0                 0
                              --------------    -------------    -------------    --------------

                              $            0    $   1,684,185    $  47,013,566    $   48,697,751
                              ==============    =============    =============    ==============

<CAPTION>

                                                                                  Life on which
                                                                                 Depreciation in
                                                 Year of                          Latest Income
                              Accumulated      Construction        Date          Statements are
Description                   Depreciation       Renovation       Acquired       Computed (C)(D)
--------------------------    -------------    -------------    -------------    ---------------
<S>                           <C>                  <C>             <C>                <C>
Vendome
  Brooklyn, NY                    3,678,073        1991             Dec. 1991         20
Pecan Creek
  Tulsa, OK                         806,847        1991             Dec. 1991         27.5
New Augusta Ltd.
  (Rainer Villas)
  New Augusta, AL                   435,496        1991             Dec. 1991         27.5
Pine Shadow Apts.
  Waveland, MS                    1,142,749        1991             Dec. 1991         27.5
Windsor Place Apts.
  Wedowee, AL                       408,586        1991             Dec. 1991         27.5
Brookwood Apts.
  Foley, AL                         679,947        1991             Dec. 1991         27.5
Heflin Hills Apts.
  Heflin, AL                        398,009        1991             Dec. 1991         27.5
Shadowood Apts.
  Stevenson, AL                     386,727        1991             Dec. 1991         27.5
Brittany Apartments
  DeKalb, MS                        376,545        1990             Dec. 1991         27.5
Hidden Valley Apts.
  Brewton, AL                       735,574        1991             Dec. 1991         27.5
Westbrook Square L.P.
  Carthage, MS                      561,595        1990             Dec. 1991         27.5
Warsaw Elderly Housing Ltd.
  Warsaw, KY                        540,132        1991             Dec. 1991         27.5
West Hill Square Apts.Ltd.
  Gordo, AL                         413,660        1991             Dec. 1991         27.5
Elmwood Assoc.
  Picayune, MS                      354,106        1991             Dec. 1991         27.5
Harmony Gate Assoc.
  Los Angeles, CA (G)                     0        1992             Jan. 1992         27.5

Less discontinued operations              0
                              -------------

                              $  23,820,319
                              =============
</TABLE>

(A)  Aggregate cost for federal income tax purposes, $146,576,191.
(B)  Rental guarantees and development  deficit guarantees for GAAP purposes are
     treated as a reduction of the asset.
(C)  Furniture and  fixtures,  included with  buildings  and  improvements,  are
     depreciated primarily by the straight line method over the estimated useful
     lives ranging from 5 to 7 years.
(D)  Since all properties were acquired as operating properties, depreciation is
     computed using primarily the straight line method over the estimated useful
     lives determined by the Partnership from date of acquisition.
(E)  The Partnership's  limited partnership  interest was sold during the fiscal
     year ended March 31,  2006.  (F) The  property  and the related  assets and
     liabilities  were sold during the fiscal year ended March 31, 2007. (G) The
     Partnership's  limited partnership interest was sold during the fiscal year
     ended March 31, 2007.
(F)  The property and the related  assets and  liabilities  were sold during the
     fiscal year ended March 31, 2007.
(G)  The Partnership's  limited partnership  interest was sold during the fiscal
     year ended March 31, 2007.

                                       83
<PAGE>

                          FREEDOM TAX CREDIT PLUS L.P.
                          AND CONSOLIDATED PARTNERSHIPS
                                  SCHEDULE III
              SCHEDULE OF REAL ESTATE AND ACCUMULATED DEPRECIATION
                                 MARCH 31, 2007
                                   (continued)


Reconciliation of Real Estate owned:
<TABLE>
<CAPTION>
                                           Cost of Property and Equipment                    Accumulated Depreciation
                                  ---------------------------------------------   ---------------------------------------------
                                                                       Years Ended March 31,
                                  ---------------------------------------------------------------------------------------------
                                       2007            2006           2005            2007            2006            2005
                                  -------------   -------------   -------------   -------------   -------------   -------------
<S>                               <C>             <C>             <C>             <C>             <C>             <C>
Balance at beginning of year      $  69,847,093   $ 144,777,331   $ 144,210,167   $  33,384,359   $  68,560,673   $  63,733,516
Additions during year:
Improvements                            949,279         741,465         749,123
Discontinued operations and
  dispositions                      (22,098,621)    (75,671,703)       (181,959)    (12,020,784)    (39,899,656)           (706)
Depreciation expense                                                                  2,456,744       4,723,342       4,827,863
                                  -------------   -------------   -------------   -------------   -------------   -------------

Balance at close of year          $  48,697,751   $  69,847,093   $ 144,777,331   $  23,820,319   $  33,384,359   $  68,560,673
                                  =============   =============   =============   =============   =============   =============
</TABLE>

At the time the local  partnerships  were  acquired  by Freedom  Tax Credit Plus
L.P., the entire  purchase price paid by Freedom Tax Credit Plus L.P. was pushed
down to the local  partnerships  as property and  equipment  with an  offsetting
credit to capital. Since the projects were in the construction phase at the time
of acquisition, the capital accounts were insignificant at the time of purchase.
Therefore, there are no material differences between the original cost basis for
tax and GAAP.

                                       84